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what do you think the consequences might be in financial markets if individuals consumed more of their incomes and thereby reduced the supply of funds available to financial​ institutions? ​(select the best answers from the​ drop-down menus.) if individuals consume​ more, ▼ more fewer dollars will be available for investment. this would ▼ increase reduce the amount of money available for new projects and drive ▼ up down the required return​ (i.e., required return of investors to buy​ bonds). over​ time, employment,​ salaries, and gross domestic product would ▼

Sagot :

The average person spends less than they earn. The surplus is invested and made available to organizations like enterprises and governments. If people spent more of their income, financial markets may suffer as a result, reducing the amount of money accessible to financial organizations.

Any marketplace where securities are traded is referred to as a financial market, which includes, among others, the stock market, bond market, FX market, and derivatives market. The efficient operation of capitalist economies depends on the financial markets.

By allocating resources and generating liquidity for businesses and entrepreneurs, financial markets play a crucial role in facilitating the smooth running of capitalist economies. Trading financial holdings is made simple by the markets for buyers and sellers. Financial markets provide securities products that give a return to investors and lenders who have extra money and make that money available to others who need it (borrowers).

An example of a financial market is the stock exchange. Financial markets are created via the buying and selling of many different kinds of financial instruments, such as stocks, bonds, currencies, and derivatives. To ensure that the markets set prices that are effective and reasonable, financial markets primarily rely on informational transparency.

Learn more about financial market here

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