CFIN
CFIN
6th Edition
ISBN: 9780357144039
Author: BESLEY
Publisher: CENGAGE L
Question
100%
Book Icon
Chapter 3, Problem 1PROB
Summary Introduction

Financial markets are the markets or the place where financial instruments like equities, bonds, derivatives, currencies, and precious metals are traded among buyers and sellers. These markets represent the mechanisms by which investors and debtors are brought together.

Expert Solution & Answer
Check Mark

Explanation of Solution

The following are the ways in which financial markets run freely and efficiently, and affect the standard of living in a country.

In financial markets, an investor gets an opportunity to make a choice to select the available investment securities which give high returns with low risk.

In financial markets, a borrower can get the optimum terms for his debt or borrowings with respect to his need and credit worthiness.

Financial intermediaries in the financial markets such are banks, credit unions, etc., collect deposits from investors and provide loans to individuals and firms those required. These intermediaries bring together investors and borrowers as efficiently as they currently do.

Financial markets provide an opportunity for foreign investors through foreign direct investment which makes more investments for small organizations and helps in increasing employment.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!
Students have asked these similar questions
What is the Biblical perspective on the Capital Markets, and what is the relationship between them? How do they research the Biblical perspective on the Capital Markets? Could you help explain how research will fulfill this requirement and integrate a Christian worldview?
Nina buys a new utility sports vehicle for 32,000 dollars. She trades in her old truck and received 10,000 dollars, which she uses as a down payment. She finances the balance at 8% APR over 36 months. Before making her 24th payment, she decides to pay off the loan. How much interest will Nina save by paying off the loan early.
General Problems: Market volatility and bubbles. How can the problem of: Insider trading and market manipulation, Lack of transparency and information asymmetry, Inequality in access to capital, and Systemic risk from interconnected financial institutions be solved? How can practice or issue be improved?
Knowledge Booster
Background pattern image
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT
Text book image
Entrepreneurial Finance
Finance
ISBN:9781337635653
Author:Leach
Publisher:Cengage
Text book image
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning