The principle function of financial markets is to:
A)maximize profits earned by financial institutions.
B)allocate factors of production.
C)redistribute resources from poor households to wealthy households.
D)funds from savers to investors.

Question

Quizplus · Accepted Answer

Financial markets primarily serve as a channel through which funds are transferred from savers (individuals and institutions) to investors (companies and governments) looking to raise capital. This helps promote economic growth and development by providing businesses with the resources needed to invest in new projects and expand their operations.

The Principle Function of Financial Markets Is To