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- Illustrate with a diagram the flow of funds from lenders to borrowers in a financial system. Diagram must include: Savers Borrowers Financial markets Function of the financial intermediaries Function of the financial markets Direct finance Indirect financeDiscuss the importance of financial markets, then illustrate with a diagram the flow of funds from lenders to borrowers in a financial system.Discuss the important of financial market, then illustrate with a diagram the flowof funds from lenders to borrowers in a financial system.
- Which of the following acts as an intermediary between the savers and investors' by mobilizing funds between them? a. Financial Markets b. Households c. Financial Instruments d. GovernmentWhich of the following acts as an intermediary between the savers and investors by mobilising funds between them? a.Financial Markets b.Households c.Financial Instruments d.GovernmentWhich of the following statements is true with regard to financial markets O a. They link the households which save funds and business firms which invest these funds: O b. They work as an intermediary between the savers and the investors by mobilising funds between them c. They allocate funds available for investment into their most productive investment opportunity d.All of the options
- Describe the nature of the basic services of financial institutions. What are the channels through which the financial system matches savers and borrowers.? What is a financial intermediary?Which of the following statements describes the cost of capital? A) The internal rate of return on investments B) The maximum acceptable rate of return on investments C) The minimum rate of return on investments D) The interest rate the bank charges its best customersBriefly explain the role of the capital market and the money market in the financial system.
- How would economic transactions between suppliers of funds (e.g., households) and users of funds (e.g., corporations) occur in a world without financial institutions?Treasury bills is the financial instrument that serves as the basis for evaluating rates of return on investment in any economy. Assess the extent to which you agree with the statement with clarifying whether you will prefer to invest in this financial instrument or not.Explain your understanding of money markets? Would you classify this as a financial market, financial instrument or financial institution? Give a reason for your answer.
