Jagdambay Exports , a manufacturer and exporter of Baby Wears Garments, is considering‘‘going public’’ to raise funds to expand in USA. The Chief Financial Officer (CFO) of Jagdambay Exports has approached the investment banking firm at which you work seeking help with its decision. Your boss asked you to explain the nature of the U.S. financial markets andthe process of issuing equity to the CFO of Jagdambay Exports.To help with this task, your boss has asked you to explain somethings regarding the U.S. financial system to CFO of JagdambayExports:
1.Explain the components of a financial market and its relevanceto Jagdambay Exports. Be explicit and explain to the CFO how financial markets differ from markets for physical assets andwhy that difference matters to Jagdambay Exports.
1.Explain the relevance of money markets and capital markets forJagdambay Exports.
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1.Analyze Jagdambay exports and advise how the CFO shouldconsider the primary market and secondary market in theexpected transaction. Base your advice, in part, upon the factthat the CFO informed of two things:1.Jagdambay exports decided to issue additional commonstock, and2.An investor purchased 1,000 shares of this commonstock from the underwriter (Merrill Lynch).
1.Advise the CFO on three primary ways in which capital may betransferred between savers and borrowers in JagdambayExports. Explain the advantages and disadvantages of eachwithin the organization.
1.Advise the CFO on securities trading on physical exchanges orover-the-counter market. Base your analysis upon what youknow about Jagdambay Exports and discuss why you adviseone method over the other.
1.Summarize the U.S. financial system advice to the CFO andprovide a timeline of expected outcomes based on your advice.(This should be no more than a paragraph or two).
1.Finally, write 2 -3 sentences about what you learned regardingthe U.S. financial system based upon this assignment.