Which of these displays the function of the financial market?(1 point) Responses Providing bank loans Providing bank loans Receiving bank loans Receiving bank loans interest paid on a saving account interest paid on a saving account Saved funds are transferred to borrowers via the sale of newly-issued securities. Companies receive money from selling stocks to investors.
Saved funds are transferred to borrowers via the sale of newly-issued securities. Companies receive money from selling stocks to investors.
The function of the financial market is displayed through several options provided. Let's go through each option and analyze them to find the correct answer.
1. "Providing bank loans": Bank loans are a common function of the financial market, as financial institutions provide loans to individuals and businesses in need of funds. However, this option is repeated twice, so we can eliminate it in order to avoid redundancy.
2. "Receiving bank loans": This option does not describe the function of the financial market. While individuals or businesses may receive bank loans, it is not the primary function of the financial market.
3. "Interest paid on a saving account": This option pertains to the banking system rather than the broader financial market. While it is related to finance, it does not represent the function of the financial market.
4. "Saved funds are transferred to borrowers via the sale of newly-issued securities": This option is a key function of the financial market. When individuals or institutions save their funds, they can invest by purchasing newly-issued securities such as stocks or bonds. The funds raised through the sale of these securities are then transferred to borrowers, including companies or governments, who need capital.
5. "Companies receive money from selling stocks to investors": This option is also a function of the financial market. Companies can raise capital by selling stocks to investors. This allows investors to become partial owners of the company, while the raised funds can be used to support the company's operations or for other purposes.
Based on the above analysis, the correct answer that displays the function of the financial market is: "Saved funds are transferred to borrowers via the sale of newly-issued securities."