The benefits of stock markets for the economy include:
I. serving as an intermediary between savers and investors.
II. revealing information about firm performance.
III. increasing the efficiency of resource allocation among firms.
A) I and II only
B) I and III only
C) II and III only
D) I, II, and III

Question

Quizplus · Accepted Answer

All three benefits listed are accurate. The stock market enables savers to invest their funds in firms, providing a vital source of finance for businesses that need to raise capital. It also provides information on the performance of listed firms, allowing investors to make informed decisions about where to put their money. Finally, it facilitates efficient resource allocation by allowing resources to flow to the firms that can use them most productively.

The Benefits of Stock Markets for the Economy Include