BUSN (with  MindTap Business, 1 Term (6 Months) Printed Access Card) (MindTap Course List)
BUSN (with MindTap Business, 1 Term (6 Months) Printed Access Card) (MindTap Course List)
11th Edition
ISBN: 9781337407120
Author: Marcella Kelly, Chuck Williams
Publisher: Cengage Learning
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Chapter 10, Problem 1LO
Summary Introduction

To discuss: The role of the financial market in the Country U economy and identify the key players in these markets.

Financial market is the market where firms can trade the financial securities, commodities, at low transaction costs and at prices that reflect supply and demand.

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Explanation of Solution

The role of the financial market in Country U’s economy is as follows:

  • To support institutional investors with their investments
  • To develop long-term financing solutions
  • To connect issuers with investors
  • To minimize business risk and hedging against interest rate or currency risk.
  • To help in the growth of the capital market
  • To enhance infrastructure growth
  • To develop trade
  • To increase the employment rate.

Following are the key players in the financial market:

  • Investors
  • Brokers
  • Dealers
  • Mutual funds
  • Investment banks
  • Market makers
  • Stock exchanges
  • Depositories
  • Clearinghouses
  • The federal reserve
  • Rating agency

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BUSN (with MindTap Business, 1 Term (6 Months) Printed Access Card) (MindTap Course List)

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