1. What is the purpose of stock and bond markets? 2. Why do people participate in them? 3. Why are they important for the economy? 4. when financial markets channel funds from savers to investors, who benefits? Condition: 1. Be precise. Explain your answers on each question in 3-5 sentences only
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- 1. What is the purpose of stock and bond markets? 2. Why do people participate in them? 3. Why are they important for the economy? 4. when financial markets channel funds from savers to investors, who benefits? Condition: 1. Be precise. Explain your answers on each question in 3-5 sentences onlyFinancial Markets and Institutions, 8e (Mishkin) Chapter 2 Overview of the Financial System 2.1 Multiple Choice 1) Every financial market performs the following function: A) It determines the level of interest rates. B) It allows common stock to be traded. C) It allows loans to be made. D) It channels funds from lenders-savers to borrowers-spenders. Topic: Chapter 2.1 Function of Financial Markets Question Status: Previous Edition 2) Financial markets have the basic function of A) bringing together people with funds to lend and people who want to borrow funds. B) assuring that the swings in the business cycle are less pronounced. C) assuring that governments need never resort to printing money. D) both A and B of the above. E) both B and C of the above. Answer: A Topic: Chapter 2.1 Function of Financial Markets Question Status: Previous Edition 3) Which of the following can be described as involving direct finance? A) A corporation’s stock is traded in an over-the-counter…Title Every financial market has the following characteristic: Description Function of Financial Markets 1) Every financial market has the following characteristic: A) It determines the level of interest rates. B) It allows common stock to be traded. C) It allows loans to be made. D) It channels funds from lenders-savers to borrowers-spenders. 2) Financial markets have the basic function of A) getting people with funds to lend together with people who want to borrow funds. B) assuring that the swings in the business cycle are less pronounced. C) assuring that governments need never resort to printing money. D) providing a risk-free repository of spending power. 3) Financial markets improve economic welfare because A) they channel funds from investors to savers. B) they allow consumers to time their purchase better. C) they weed out inefficient firms. D) eliminate the need for indirect finance.
- 1. Discuss how does e-money helps in achieving financial inclusion of the BSP? 2. How does Financial Market Affect an MNC's Value? 3. Which do you prefer? the traditional way of transacting with banks and other financial institutions or with the use of e-banking? Explain why?Q1. Explain the functioning of different players in financial market. Q2 What is financial market? Explain its functions.? Q3. What are the classification of financial market? Explain its different components?1. Explain why financial markets are important to the health of economy? 2. In a world without complete information and transaction costs, financial intermediaries would not exist. Is this statement true,false or uncertain? Explain your answer. 3. Explain the flow of funds in the financial system thru direct and indirect financing.
- Answer Any two questions Q1. Explain the functioning of different players in financial market. Q2. What is financial market? Explain its functions. Q3. What are the classification of financial market? Explain its different components?Question 6 : (A) Multiple Choice Questions: 1. Finance can be defined as (a) the system of debits and credits. (b) the science of the production, distribution, and consumption of wealth. (c) the art and science of managing money. (d) the art of merchandising products and services 2. Which of the following assist companies in raising capital, advise firms on major transactions such as mergers or financial restructuring, and engage in trading and market making activities? (a) Investment Banks (b) Securities Exchanges (c) Mutual Funds (d) Commercial Banks 3. A financial manager must choose between three alternative investments. Each asset is expected to provide earnings over a three-year period as described below. Based on the wealth maximization goal, the financial manager would choose (Justify your answer) Year Asset X Asset Y Asset Z 1 $15,000 $ 4,000 $ 6,000 2 $9,000 $10,000 $14,000 3 $5,000 $15,000 $11,000 $29,000 $29,000 $31,000 (a) Asset X. (b) Asset Y. (c) Asset…In making a financing decision, how would a financial manager answers questions like: 1. How should the cash required for investment be raised?2. Should we borrow from a bank or should we issue new shares ofstocks?
- Q1) a.What do the investors in a firm expect if a firm retains earning rather than distributing earnings in the form of dividends?b. What do we mean by financial governance? Explain the types of financial governance? c.What are the types of financial deals?1a)List and explain the five finance functions in an organisation b)Why should it worry when you hear that financial intermediation is Low in an economy and what do you think should be done to improve financial intermediation.Q1. As Ms. Sara prepares for her trip to London, she reviews a typical bank balance sheet. What types of assets does a bank own, and what types of liabilities fund them? Q2. Explain why financial institutions such as banks are necessary in an economy.