The government regulates financial markets for two reasons which are __________?
Correct answer: D. Both A and B
- A. increase information available to investor
- B. ensure the soundness of financial system
- C. create a sound atmosphere
- D. Both A and B
Explanation
Financial-market regulation protects investors by improving the information available to them and protects the economy by maintaining the soundness of the financial system. Therefore both stated reasons apply.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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