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Finance

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Howard College
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Financial Institution and Financial Markets Student’s Name: Institutional Affiliation: Date: Defend the study of financial institutions and financial markets. — Typically, financial institutions focus on distributing funds,     capital, and money in various payment mechanisms. Financial markets allow the movement of funds for people saving money to investors of capital assets (Nikitina & RepetaTursunova, 2014). — The study of financial markets allows investors to understand how to trade bonds or stocks. The study of financial institutions will enable investors to understand how banks, insurance companies, pension fund schemes, and mutual funds operate. (Nikitina & RepetaTursunova, 2014). Studying financial institutions and financial markets is essential — because it creates opportunities for investors to diversify risks. It also allows investors to specialize in particular services or markets. Determine the key participants in financial transactions — The key participants in financial transactions are the government, businesses, and individuals. 1. Individuals—  Mainly, individuals are considered as the net suppliers (Duygun et al., 2020). This implies that their savings are higher than their borrowings. 2. Businesses—  They participate in financial transactions as net demanders. In other words, businesses borrow more than what they save. 3. Governments—  Governments are also net demanders of funds because they borrow more th ...
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