Answer:
- Explain how financial institutions serve as intermediaries between investors and firms.
- Provide an overview of financial markets.
- Explain how firms and investors trade money market and capital market securities in the financial markets in order to satisfy their needs.
- Describe the major securities exchanges.
- Describe derivative securities and explain why firms and investors use them.
- Describe the foreign exchange market.
Explaination:
Financial institutions serve as intermediaries by channeling the savings of individuals, businesses, and governments into loans or investments. They are major players in the financial marketplace, with more than $12 trillion of financial assets under their control. They often serve as the main source of funds for businesses and individuals. Some financial institutions accept customers' savings deposits and lend this money to other customers or to firms. In fact, many firms rely heavily on loans from institutions for their financial support. Financial institutions are required by the government to operate within established regulatory guidelines.
