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Vsevolod [243]
3 years ago
8

Which of the following is an example of a financial market?

Business
1 answer:
ale4655 [162]3 years ago
7 0

Answer:

A. A local coffeehouse where people regularly buy and sell financial instruments.

Explanation:

A local coffeehouse where people regularly buy and sell financial instruments is an example of a financial market because by definition a financial market is a place where people buy and sell financial securities and derivatives at minimal transaction costs.

Although in the scenario above it is strange that the location is a coffee shop, however, what is actually essential is the fact that the activities that defines a financial market is taking place therein.

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The longer the investment period is, the more time interest will be compounded, and the more the investment will grow.  Nan made her investment at age 25. By the time she retires, her investment period will be 35 years.  Neil started her investment at age 30. At any given time after they are both age 30, Nan's investment will have earned compounded interest five more times than Neil. Therefore, Nan will have more money at any given time.  

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