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Business LibreTexts

2: The Financial System

  • Page ID
    651
  • CHAPTER OBJECTIVES

    By the end of this chapter, students should be able to:

    • Critique cultural stereotypes of financiers.
    • Describe the financial system and the work that it performs.
    • Define asymmetric information and sketch the problems that it causes.
    • List the major types of financial markets and describe what distinguishes them.
    • List the major types of financial instruments or securities and describe what distinguishes them.
    • List the major types of intermediaries and describe what distinguishes them.
    • Describe and explain the most important trade-offs facing investors.
    • Describe and explain borrowers’ major concerns.
    • Explain the functions of financial regulators.