Which one of these best defines the objective of a well-functioning financial market?

Question

Quizplus · Accepted Answer

The objective of a well-functioning financial market is to establish accurate security prices. This allows for efficient allocation of capital and fair pricing for investors. Creating higher security prices (B) or increasing shareholder value by any means possible (D) are not the primary objectives of a financial market, as this could lead to overvalued securities and market manipulation. Eliminating short-selling profits (C) is not a primary objective either, as short-selling can be a valuable tool for risk management and price discovery.

Which One of These Best Defines the Objective of a Well-Functioning