Financial markets match individual borrowers and savers and individuals with different tolerance for risk T/F

Financial markets match individual borrowers and savers and individuals with different tolerance for risk

T/F

Expert Solution

True

Following are some function of Financial market :

Borrowing and Lending:

Individual(lender) with excess fund lend money to Individual(borrower) who require money.

Risk Sharing :

Financial market allows to transfer of risk from individual who does not want to take risk to Individual who is ready to take risk.

jeff jeffy answered 2 years ago

A country's financial system provides three services to savers and borrowers. One of these services is...

A country's financial system provides three services to savers and borrowers. One of these services is a. the ability of savers to maximize risk. b. the ability of the financial system to buy and sell stocks. c. the ability of savers and borrowers to maintain a sound investment. d. the ability of the financial system to transfer information.

In a financial system, funds flow from the primary savers to the ultimate borrowers. Discuss the...

In a financial system, funds flow from the primary savers to the ultimate borrowers. Discuss the two main approaches through which this may be achieved. Further, explain the specific role financial intermediation plays in this process? Word Count:?2,500 maximum

T/F 1. Financial markets connect production needs for money with consumption’s available savings. T/F 2. Money...

T/F 1. Financial markets connect production needs for money with consumption’s available savings. T/F 2. Money markets deal in short-term debt. T/F 3. Sunk costs have already been spent and are ignored. T/F 4. Retained earnings are not a source of capital. T/F 5 . The FED usually lowers interest rates if there is a fear of inflation. Explain why the cost of debt is lower than the cost of capital?

Explain the importance of calculating the beta value of individual stocks in estimating the risk tolerance...

Explain the importance of calculating the beta value of individual stocks in estimating the risk tolerance of investors? Explain with examples.

Illustrate how do financial institutions help individual savers diversify their portfolio risks?

Illustrate how do financial institutions help individual savers diversify their portfolio risks? Which type of financial institution is best able to achieve this goal?

Identify the different types of financial markets and financial institutions, and explain how these markets and...

Identify the different types of financial markets and financial institutions, and explain how these markets and institutions enhance capital allocation.

How can risk be transferred in financial markets?

T/F 1. Financial markets connect production needs for money with consumption’s available savings. 2. How can...

T/F 1. Financial markets connect production needs for money with consumption’s available savings. 2. How can the FED react to higher prices ( inflation) ? 3. How long does it take money earning 14% to do double? 4. Explain the effects of increasing interest rates on short term and long term bonds. Which is better and why? 5. If you own 3 stocks A, B, and C. What is your total return of your portfolio? Stock $ invested Return A...

T F To have a Snort rule match on both inbound and outbound traffic, the rule...

T F To have a Snort rule match on both inbound and outbound traffic, the rule should use the flow:to_server,from_client,established; option. Answer: _____ T F Host-based IDS can be used to monitor compliance with corporate policies such as acceptable use of computer resources. Answer: _____ T F An on-demand operational IDS model is not suitable if legally admissible data collection is required. Answer: _____ T F Current criminal and civil procedure laws and rules of evidence do not apply to...

Consider 3 individuals A, B & C with the following risk profiles (4 points) Individual A:...

Consider 3 individuals A, B & C with the following risk profiles (4 points) Individual A: P(healthy) = 90% and I(healthy) = 1000 and I(sick) = 0 Individual B: P(healthy) = 95% and I(healthy) = 3000 and I(sick) = 500 Individual C: P(healthy) = 99% and I(healthy) = 4000 and I(sick) = 500 P() = probability I() = Income An insurance company has agreed to cover these individuals for $1000 each. They have to pay a premium of 100. True...

Question