Gains from Having a Stock Exchange in a Country
Question
Explain the benefits a country can gain from having a stock exchange.
Category:
Economic Growth & Development
Frequently asked question
Preview Answer
I. 🍃Introduction
- Definition of financial markets
- Importance of financial markets in the economy
II. Input
- Market for the sale of shares and bonds
- Encourages saving and investment
- Facilitates mergers and acquisitions
- Source of finance for firms
III. Output
- Enables firms to grow
- Government funding through bonds
- Attracts MNCs to set up in the country
- Creation of other financial institutions
IV. Advantages of financial markets
- Increased economic growth
- Increased employment opportunities
- Increased exports
V. Disadvantages of financial markets
- Risk of market failure
- Unequal distribution of wealth
VI. 👉Conclusion
- Recap of the importance of financial markets in the economy
- Future prospects of financial markets.
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