Stock Exchange works as a mechanism for the valuation of securities through the forces of demand and supply. Identify the related functions performed by the stock exchanges.
Stock Exchange works as a mechanism for the valuation of securities through the forces of demand and supply. Identify the related functions performed by the stock exchanges.
(a) Safety of transaction.
(b) Spreading of the equity cult.
(c) Pricing of security.
(d) Providing liquidity and marketability to existing securities.
Answer (c) Pricing of security.
Explanation: A stock exchange, bourse, or securities exchange is a trade where traders and stockbrokers can sell and buy securities, like shares or bonds, stock, and other monetary instruments. Stock exchanges may likewise give facilities for the redemption and issue of instruments, securities, and capital events like paying dividends and income. Stock exchanges fix the prices for their securities based on the market conditions, this process of determining stock prices is called the pricing of securities.
(a) Safety of transaction.
(b) Spreading of the equity cult.
(c) Pricing of security.
(d) Providing liquidity and marketability to existing securities.
Answer (c) Pricing of security.
Explanation: A stock exchange, bourse, or securities exchange is a trade where traders and stockbrokers can sell and buy securities, like shares or bonds, stock, and other monetary instruments. Stock exchanges may likewise give facilities for the redemption and issue of instruments, securities, and capital events like paying dividends and income. Stock exchanges fix the prices for their securities based on the market conditions, this process of determining stock prices is called the pricing of securities.
