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Summary Week 1 Assignment FIN571.docx Financial markets and institutions University of Phoenix FIN/571 Corporate Finance Introduction The financial markets refers to any marketplace where trading of securities trading takes place. The bond market, the stoc$5.49
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Summary Week 1 Assignment FIN571.docx Financial markets and institutions University of Phoenix FIN/571 Corporate Finance Introduction The financial markets refers to any marketplace where trading of securities trading takes place. The bond market, the stoc
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Week 1 Assignment FIN Financial markets and institutions University of Phoenix FIN/571 Corporate Finance Introduction The financial markets refers to any marketplace where trading of securities trading takes place. The bond market, the stock market occurs, the options market and the forex mar...
week 1 assignment fin571docx financial markets and institutions university of phoenix fin571 corporate finance introduction the financial markets refers to any marketplace where trading of sec
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Running head: FINANCIAL MARKETS AND INSTITUTIONS
Financial markets and institutions
University of Phoenix
FIN/571 Corporate Finance
Introduction
The financial markets refers to any marketplace where trading of securities trading takes
place. The bond market, the stock market occurs, the options market and the forex market are
examples of the capital markets. Financial markets are essential to the smooth and easier
functioning of capitalist economies like the US.On the other hand,Financial-market
intermediaries (Madura, 2020) financial institutions include commercial banks and cooperative
bank as examples.
Why are financial markets and institutions important?
, FINANCIAL MARKETS AND INSTITUTIONS 2
Smoothly operated and well-developed financial markets and institutions play an
important part in contributing to aneconomy’s efficiency and health. There exist a very strong
relationship between financial market development and economic growth (Madura,
2020).Financial markets help to efficiently channel the economic flow of investment and saving
in the ways that ease the output of goods and services and capital accumulation. Capital markets
and institution enable investors to specialize and diversify risk in particular products or services.
Large financial markets with many trading activities provide more liquidity to participants in the
markets (Oskooe, 2010). With common financial institution such as banks, insurance companies,
pension funds and mutual funds, the United States has well-developed financial services sector.
Efficient financial markets and institution promote the flow of fund globally between two
countries or more. Finally, well established capital markets and institutions the cost of searches
and transaction in the economy. This is because they provide a large array of financial products
that has varying maturity, risk and pricing structure (Pradhan, 2018). This provides for closely
matching lenders and borrowers to their needs. As a result, money-needed individual, business,
and governments can determine which financial markers or institution can provide financing and
the involved costs. This helps investor’s to equate the costs of the funding to their projected
return on investment. A mix of well-developedfinancial markets and institutions suits the need of
both lenders and borrowers, as well as the economy as a whole.
Types of financial markets
The global economy includes a lot of capital markets. While they vary in size, each
country has at least one financial market. Some financial markets are smaller while other are
globally recognized.
Stock market
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