Explain Interest Rate Market Segmentation Theory and give an example of it?
Market Segmentation Theory states that long and short term interest rates are not dependent on each other rather bond interest rates are affected by supply and demand in the market. So, we cannot compare yields of securities having different maturity lengths neither we can use them for bond yield prediction. In essence interest rates of long-, medium-, short-term bonds should be treated as they are securities in different markets.
In general, people/organisations buy bonds of different maturity age based on their investment goals and characteristics. For example, insurance companies focus on maximizing their income so they buy long-term bonds whereas banks look for minimum volatility and high liquidity so they invest in short-term bonds.
The chart below compares 2 year and 5 year US Treasury yields. Over the time, the size of the gap between these two yields has been varying so we cannot deduct any correlation here.
Explain Interest Rate Market Segmentation Theory and give an example of it?
Explain Interest Rate Liquidity Theory and give an example of it?
With the following Interest Rate Theories, Expectation, Liquidity, Market Segmentation, & preferred habitat hypothesis theory how do each of these theories explain changes in the economy?
Explain Interest Rate Preferred Habitat Hypothesis Theory and give an example of it?
Explain Interest Rate Expectations theory and provide an example?
What is the market segmentation?What are the bases for market segmentation? Explain each briefly.
Accounting and Finance -Theory Questions Briefly explain the relationship between the market rate of interest and the value of a bond.
1. How does expected inflation rate affects interest rate? Use the demand and supply in the bond market to explain your answer. 2. Differentiate the Expectation theory and Market Segmentation theory in explaining the yield curve?
Give 5 reasons why companies opt for market segmentation
Identify the four bases of Market Segmentation and give three market segmenting variables that demonstrate each of the four bases along with an example of each of the variables uses (brand or product category). The example for each variable should demonstrate a heavy use of such variable in terms of a specific brand/product category (choose best examples that predominately uses the segmenting base to market their offering). Please organize the response by base and list the variables appropriate under each base...
1. What is global market segmentation? What roles does it play in global marketing strategy? 2. Explain why global marketer implements global market segmentation. 3. Discuss why global market segmentation is a cross-national boundary approach 4. Explain why the hybrid global segmentation is more effective. Do your own research to find an additional example of global market segmentation.