Which of the Following Functions Is Not Performed by Financial

question 60

Multiple Choice

Which of the following functions is not performed by financial markets?

• A)facilitating large-scale production
• B)reallocating spending across time
• C)reducing risk through diversification
• D)discovering new production techniques
• E)disciplining management of corporations

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Definitions:

Industrially Advanced Nations

Countries that have highly developed industries and infrastructure, often characterized by high levels of income, technological innovation, and standard of living.

Managed Float

A currency exchange rate policy where the central bank allows the currency value to fluctuate in the foreign exchange market but intervenes to prevent excessive movements.

Fixed Rate System

A monetary system in which exchange rates are set and maintained at a certain level by a government or central bank.

Flexible Exchange Rates

A system in which the worth of a currency is permitted to vary based on the foreign exchange market, free from direct governmental interference.