Question : Which function of financial market is highlighted in the given statement?
Statement: Investors can convert their investment into money whenever they desire.
Option 1: Mobilization of savings and channelising them into most productive use
Option 2: Facilitates price discovery
Option 3: Provides liquidity to financial assets
Option 4: Reduce the cost of transactions
Correct Answer: Provides liquidity to financial assets
Solution : This is a market where the buyers and the sellers of all securities are available all the time. This is the reason that it provide liquidity to securities. It means that investor can invest their money whenever they desire to invest in securities through the medium of financial market. They can also convert there investment into money whenever they so desire.
Hence, option C is correct.
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