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Financial markets determine asset prices through the forces of supply and demand, where buyers and sellers interact to establish a price at which an asset can be traded. Factors influencing this interaction include economic indicators, interest rates, market sentiment, and geopolitical events. As new information becomes available, market participants adjust their expectations, leading to price fluctuations. This dynamic process reflects the collective assessment of an asset's value at any given time.
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How can a bursting of an asset-price bubble in the stock market help trigger a financial crisis?
Because... economics.
How is the fair market value determined for a specific item or asset?
The fair market value of a specific item or asset is determined by considering factors such as the item's condition, demand, comparable sales, and other market conditions. This value represents the price that a willing buyer and seller would agree upon in a fair and open market transaction.
What is the difference between spot price and market price?
The spot price is the current price at which a commodity or asset can be bought or sold for immediate delivery, while the market price is the price at which a commodity or asset is currently trading in the market.
Can you explain how a futures contract works in the financial market?
A futures contract is an agreement to buy or sell an asset at a set price on a future date. It allows investors to speculate on the price movement of the asset. Traders can profit if the asset's price moves in their favor, but they can also incur losses if the price moves against them.
How do you determine the strike price for options?
The strike price for options is determined based on factors such as the current market price of the underlying asset, the volatility of the asset, and the time until the option expires. Traders and investors analyze these factors to choose a strike price that they believe will be profitable if the option is exercised.
How can a bursting of an asset-price bubble in the stock market help trigger a financial crisis?
Because... economics.
How is the fair market value determined for a specific item or asset?
The fair market value of a specific item or asset is determined by considering factors such as the item's condition, demand, comparable sales, and other market conditions. This value represents the price that a willing buyer and seller would agree upon in a fair and open market transaction.
What is the difference between spot price and market price?
The spot price is the current price at which a commodity or asset can be bought or sold for immediate delivery, while the market price is the price at which a commodity or asset is currently trading in the market.
Can you explain how a futures contract works in the financial market?
A futures contract is an agreement to buy or sell an asset at a set price on a future date. It allows investors to speculate on the price movement of the asset. Traders can profit if the asset's price moves in their favor, but they can also incur losses if the price moves against them.
How do you determine the strike price for options?
The strike price for options is determined based on factors such as the current market price of the underlying asset, the volatility of the asset, and the time until the option expires. Traders and investors analyze these factors to choose a strike price that they believe will be profitable if the option is exercised.
Do financial statements show the market value of an asset?
In general, financial statements show the book value of an asset, not the market value. The few instances where the financial statements will show market valuations are as follows: * When derivatives are carried for hedge purposes, they are periodically marked-to-market * When an investment appears to materially have lost value (when comparing to similar instruments in the market or, for illiquid markets, when operating cash flows from an investment go down markedly), conservatism requires the asset value to be moved to the "market" or lower price
What is current price?
The term "current price" typically refers to the most recent market price at which an asset, stock, commodity, or currency is trading. This price can fluctuate frequently due to supply and demand dynamics, market sentiment, and economic factors. For the exact current price of a specific asset, it's best to refer to a financial news website or trading platform.
What is market price determined by?
the market or market forces
What is the formula for Ra and P?
The formula for Ra (the average rate of return) is given by Ra = (Ending Value - Beginning Value + Dividends) / Beginning Value. For P (the price of a financial asset), it typically refers to the current market price, which can be determined by supply and demand dynamics in the market. If you meant a specific context for P, please clarify for a more precise answer.
How do you price an asset which is not currently traded on the market?
estimating the price with the season
What is risk asset?
price,market risk, intrest rist...
Why market price of share differ from book value?
market value is based on demand for the asset, whereas book value is based off the asset's depreciation rate (BV= cost - accumulated deperciation) which is determined by useful life and salvage value. (cost-salvage rate/life)
