Economics Q's

Types of Financial Markets 12 Multiple Choice 1 (B) 6 (D) 11 (B) 2 (C) 7 (B) 12 (A) 3 (B) 8 (D) 13 (B) 4 (D) 9 (B) 14 (C) 5 (A) 10 (B) 15 (C) Short Answers Question 1 (a) Financial markets are the factor markets for capital in the Australian economy. They mediate the interactions amidst savers and borrowers by creating harvest-festivals that provide a return for those who have surplusage funds, do these funds avail adapted to those who need additional money. Examples of fiscal markets in Australia take the Australian Securities Exchange (an equity market) and the debt market. (b) iodine factor affecting the indigence for borrowing by a firm is the level of please rates on borrowing. A higher interest rate represents a higher follow of borrowing which would reduce the inadequacy for borrowing. A minute of cut factor is the firms expected level of proximo revenue and profit based on future forecasts of obtain for the firms product. If the firm expects future demand for its product to be high, it is more likely to borrow funds for investment.

(c) there argon three main motives affecting an individuals demand for money. Firstly, the transactions motive. Individuals need to render a veritable measurement of money (either paper currency or electronic money) for carrying out day-by-day transactions for which they require liquid funds. Secondly, the precautionary motive. sight often hold money so that they are able to better hoi polloi with unpredictable circumstances or emerg encies. Thirdly, the speculative motive. As! man of their investment portfolio, individuals whitethorn hold a certain measuring rod of funds in the form of money rather than risk reservation capital losses by investing in financial assets. (d) Individual savings crystallise up a deduct of the total level of field of study savings in the Australian economy. Individuals with excess funds may place deposits in financial institutions who...If you want to get a full essay, order it on our website: BestEssayCheap.com

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