GCE Commerce 1989 Theory question 110

Theory question 110

Stock Exchange

Commerce 2 (answer five questions)
Describe any five advantages of the Stock Exchange Market

Show the model answer
Model answer

Any five, described: provides a market for buying and selling existing securities, so investors can turn shares into cash (liquidity); helps companies and government raise long-term capital; encourages saving and investment; prices quoted show the value of shares and the health of companies and the economy; protects investors through strict rules for listing and dealing; helps government borrow by selling stocks and bonds; attracts foreign investment.

Explanation

Five clear advantages, each with a sentence of explanation.