2, 3 and 5
1, 2 and 4
1, 3 and 5
2, 3 and 4
Answer is Right!
Answer is Wrong!
The correct answer is B. 1, 2 and 4.
A financial system is a system that allows people to exchange money and other financial assets. It includes the institutions, markets, and instruments
that facilitate the transfer of money between buyers and sellers.The functions of a financial system are to:
- Provide a means of payment. This allows people to buy and sell goods and services without having to carry around large amounts of cash.
- Channel funds from savers to investors. This allows businesses to raise money to invest in new projects, and individuals to save for retirement or other goals.
- Provide a means of risk management. This allows people to protect themselves against financial losses, such as those caused by changes in interest rates or the stock market.
- Promote economic growth. By providing a way for businesses to raise money and individuals to save, a financial system can help to stimulate economic growth.
The options are:
- The operation of a payments system. This is a key function of a financial system, as it allows people to transfer money easily and efficiently.
- Provides the means of portfolio adjustment. This allows people to adjust their investment portfolios to reflect their changing needs and goals.
- Helping to reduce unemployment. This is not a direct function of a financial system, but a healthy financial system can help to create jobs by providing businesses with the capital they need to invest and expand.
- Channelizing funds between lenders and borrowers. This is a key function of a financial system, as it allows businesses and individuals to access the capital they need to invest and grow.
- Helping speculators to bet on price movements. This is not a core function of a financial system, but it is one that can be beneficial to some investors.
Therefore, the correct answer is B. 1, 2 and 4.