finance questions

"Interest Rate Caps and Floors" Assess the volatility risk with an investment in a derivative, using aninterest rate cap or floor in today’s marketplace. Indicate whether or not youwould advise financial institutions to engage in this type of investment.Provide support for your response. Assess the effectiveness of using the Black-Scholes model to value cap andfloor type investments, indicating how any pitfalls with this method ofvaluation can be minimized. Provide support for your response."Credit Protections" Assess the ability of the credit-derivatives market to provide warningsignals well in advance of future downgrades in credit rating or headlines ofcompany problems holds true today.  Provide an example of when the statementheld true in today’s financial markets. Consider the ideal role of the government, if any, in bringing about moretransparency in the market for credit protection. Provide an example of whengovernment involvement would have helped protect investors from risks related tocredit.