Capital Market Institutions - SS2 Economics Past Questions and Answers - page 1
Which of the following is an example of a capital market institution?
Savings and loan association
Credit card company
Stock exchange
Credit union
What types of financial instruments are typically traded in capital markets?
Short-term debt securities
Long-term debt securities
Insurance policies
Commodities
Which of the following is not a role played by capital market institutions?
Helping companies raise capital
Providing research and analysis to investors
Facilitating short-term borrowing
Enabling secondary trading of securities
(It is money market institutions that facilitate short-term borrowing and not capital market institutions)
What is the primary function of investment banks as capital markets institutions?
Issuing and selling securities for companies
Providing savings accounts to customers
Offering credit cards to consumers
Selling insurance policies to businesses
(These institutions assist companies in issuing and selling stocks and bonds to investors)
What are examples of capital market institutions?
Examples of capital market institutions include stock exchanges, investment banks, and mutual funds.
What role do mutual funds play in capital markets?
Mutual funds are a type of investment company that pools money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities. They provide individual investors with access to a wide range of investment opportunities and professional management of their investments.