Which of the following is NOT a purpose of valuing financial securities? a. Valuation is used to provide sensible financial decisions. b. Valuation is used to get the intrinsic value of a financial security. c. Valuation is helpful for investors in order to determine whether to buy or sell their securities d. Valuation is used to predict the exact prices of financial securities.

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Functions of Financial Institutions

Financial institutions are businesses that are formed to deal with financial and monetary transactions. These organizations primarily accept deposits, advance loans, make investments, and provide foreign exchange services. Financial institutions include, but are not limited to, banks, insurance companies, trust companies, brokerage firms, and investment bankers. Because financial institutions play such an important role in the economy in terms of monetary transactions, regulating their activities has become a requirement for governmental authorities. As a result, the government creates a multitude of laws and regulations to oversee the activities of financial institutions.