Although we stated that real assets constitute the true productive capacity of an economy, it is hard to conceive of a modern economy without well-developed financial markets and security types. How would the productive capacity of the U.S. economy be affected if there were no markets in which to trade financial assets?

Q: 1.      Do you know what International Financial Institutions is? What are its examples? What role…

A: The following Questions are answered: 1. Do you know what International Financial Institutions are?…

Q: A challenge facing U. S. companies adopting IFRS is ______________________________. a.certain areas…

A: Some companies earlier following US GAAP have adopted IFRS for accounting and reporting purposes.

Q: A currency which is in the digital form and without government's control is called: a. Crowd funding…

A: Crowd funding means raise funds required from different people at large.…

Q: The probability of losing investment in a foreign country is known as: O confiscation O political…

A: Investment made in foreign countries outside jurisdiction of domestic country is subject to risk.

Q: What is capital rationing? What types of firms might encounter capital rationing?

A: A plan adopted by any organization to limit the several new projects or investments in any…

Q: Which of the following is NOT usually associated with “financial risk”? a. A rise in the country’s…

A: Financial risk is the possibility of capital loss as a result of shifting market conditions.…

Q: How COVID-19 affect international capital market. In general, does the market value of companies…

A: The (COVID-19) flare-up is causing inescapable concern and monetary difficulty for shoppers,…

Q: Are there international differences in firms’ financial leverage?Explain.

A: It is a term used to define the capital structure of a company has on a specified date. It reports…

Q: Banks with no foreign assets or liabilities are not exposed to foreign currency risk. True or False?…

A: Risk  The uncertainties related to investing are known as the risk.  Risk is present in every type…

Q: Is cryptocurrency good for the economy of any country? Explain thoroughly.

A: Cryptocurrencies are digital or virtual tokens that use cryptography to secure and verify…

Q: Contrast the modern construct for FISIM with a measure that sub- tracts deposits from the financial…

A: Financial Intermediation Services Indirectly Measured (FISIM) In general, only a small part of…

Q: Multinational management commonly do NOT fully understand: a. institutions, history and culture. b.…

A: Multinational management is all about managing a company or an entity or an enterprise in different…

Q: It is pertinent to ask whether the reforms brought about in financial sector of Pakistan will…

A: the question is based on the concept of financial inclusion and sustainability in financial industry…

Q: What is the bad result if a cashless society increases more private currency?

A: A cashless society is an economic situation during which financial transactions are administered…

Q: Which of the following statements is true about expropriation? Multiple Choice Small firms are more…

A: Expropriation is the act of a government claiming privately owned property against the wishes of the…

Q: What are the disadvantage of embracing digital currencies in investment or financial transaction?

A: Digital money is money that only exists in digital form. This is neither a tangible item like…

Q: open

A: Open market operations refer to the act of purchasing or selling the securities of the government by…

Q: What was the main purpose of the Troubled Asset Relief Program (TARP)?   A. Sell risky assets to…

A: TARP It is a U.S government program to buy an asset whose value has a major fall and is not…

Q: Why is it vital for banks to diversify worldwide.

A: Diversify is a term used to describe a technique which reduces risk by allocating investments across…

Q: do you think that the collaboration between Central Banks and Government creates challenges for…

A: If a country's economy were a human body, the central bank would be its heart. And, just as the…

Q: What impact does the bitcoin trend have on firms and customers (both globally and in the United…

A: A blockchain is a peer-to-peer network that monitors and organised it while also serving as a secure…

Q: When any central bank wanted to increase the money supply and loosen credit conditions, what would…

A: In order to increase the money supply and loosen credit conditions, the central bank would purchase…

Q: Open market operations are used by the federal government as a means of changing the money supply in…

A: Open market operations are generally reflective of the purchase and sale of securities by the…

Q: What are two monetary policies that could be implemented by the central bank which would have the…

A: Federal bank achieve of economic growth by monetary policy by increasing or decreasing money supply.

Q: The importance of international financial institutions for the growth of the economy around the…

A: International financial institutions (IFI) are a type of financial institution that is established…

Q: whether capital generated in the industrialized countries is finding its way to and from emerging…

A: An economy is a large set of interrelated production, consumption, and exchange activities that help…

Q: Moral hazard is a barrier to financing global growth because: OPTIONS: if investors have trouble…

A: Moral hazard is a situation which occurs as a result of the lack of accurate information or…

Q: “The growth of international banking has been driven by a desire for increased access to capital,…

A: The growth of international banking has undeniably been driven by various compelling factors,…

Q: True or False   One of the factors responsible for globalization of financial markets and…

A: Deregulation is the removal or decrease of regulations that impede free competition, enabling market…

Q: you think that the pandemic has impacted the ability of firms to raise

A: Pandemic have impact on whole business scenario and financial conditions.

Q: Why do companies with small profit margins have a smaller motivation to hedge against currency…

A: Currency movements can have a significant impact on the profitability of companies, particularly…

Q: How do you relate development of global value chains in global economy and the causes of 2008…

A: The question is based on the concept global value chain and its role in crisis of 2008-09.

Q: Generally, is the cost of capital for investing in international countries more or less than…

A: The cost of capital is reflection of the required rate of investment for investors for investing in…

Q: How does climate change threaten financial stability?

A: Climate change is threatening financial stability at a rapid speed and in a highly tangible and…

Q: Which statement is true of digital legal tender?

A: In simple words, digital currency means electronic currency. These currencies can be accessed only…

Q: al generated in industrialized countries finds its way to and from emerging mar

A: Capitalized country like US and China have too much capital and other resources so they try to earn…

Q: National Income measures are not good measures of development." What are your opinions about this…

A: There are certain limitations that is associated with measurement of National income as National…

Q: Capital and the production of goods and services. In many developing nations, limited financial…

A: The two options available to the company is to raise finance via private placement of shares or to…

Q: why the non-government financial institutions are allowed to operate in our economy.

A: A non- government financial institution are those that does not have full banking license or is not…

Q: Made sure you differentiate portfolio investments from FDI. Can we argue that a "A closed economy,…

A: FDI and  Portfolio investment - FDI or Foreign Direct Investment  involves a large commitment of…

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.