Finance Analysis Case Study Assignment Questions

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To complete your assignment, make a copy of this template and provide answers to the following questions. For more details about the assignment, refer to the Finance Analysis Assignment Instructions

  1. Identify the RBA’s monetary policy since February 2025. Discuss its rationale using the monetary policy target and objectives, referencing relevant theories presented in this unit and the information from the article, quoting relevant sentences when necessary to support your answers. In your discussion, if relevant, differentiate between the cash rate and market interest rates, and explain how changes in the cash rate impact the market interest rates and, in turn, affect the broader economy.

The word limit is 350 words (+/- 10%).

  1. Examine the effects of the declining cash rate on a bank’s credit risk, liquidity risk, and interest rate You should draw on theories presented in the unit and the information from the article, quoting relevant sentences when necessary to support your argument.

The word limit is 250 words (+/- 10%).

  1. Assume you are a growth-oriented young full-time professional with a high-risk tolerance, with the following financial profile
Gross Annual Salary $65,000
Monthly living expenses (includes rent, transport, utilities, groceries, and leisure) $3,500
Wealth Allocation: Weightage of Current Net Wealth
·         Savings (Term Deposits): 60 %

 

·         Investment Portfolio (ASX-listed

ETFs & Large-Cap Shares, e.g., VAS, CSL, CBA):

30%
·         Fixed-Income Investments (Australian Treasury Bonds): 10%
Home Ownership Goal
·         Target Property: 3-bedroom unit in a middle-ring suburb of Melbourne
·         Current Estimated Price: $750,000
·         Target Deposit: 20% ($150,000)
·         Time Horizon: Plan to buy within 3 years
·         Home Loan Interest Rate (as of 2025): 5.2% (variable)

Discuss how the series of cash rate cuts since February 2025 would affect your financial situation regarding your investment returns and your goal of purchasing a house. What investment strategy would you adopt in response to this monetary policy to help achieve your home ownership goal? Your analysis should be research-based on current market information, theories learnt in this unit, and information from the article, quoting relevant sentences when necessary to support your arguments.

The word limit is 350 words (+/- 10%).

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