Financial Market Flashcards
1
Q
Explain the role of the Financial Market.
A
A bridge between savers and borrowers in an economy. It is the factor market for capital.
2
Q
Discuss the advantages/disadvantages of increased integration with global financial markets.
A
Advantages:
- Diversify risk into other markets
-
3
Q
What is the importance of having a competitive Financial Market
A
Importance of competition improves the allocation of resources in the economy and makes it easier for firms to raise funds. This will contribute to higher levels of investment, economic growth and improved standards of living.