Which one of the following is NOT a consequence of a well-functioning financial market?

Question

Quizplus · Accepted Answer

A well-functioning financial market ensures that better projects get financed and there is greater capital accumulation. It also results in a lower cost of capital. However, most projects getting financed can lead to a misallocation of resources and potentially increase the risk of financial instability. Therefore, it is not a consequence of a well-functioning financial market.

Which One of the Following Is NOT a Consequence of a Well-Functioning