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Basic Question 4 of 7

The functions of the financial system include everything below except ______

A. helping some borrowers get capital for their very risky projects.
B. helping information-motivated traders trade in order to profit quickly from information.
C. establishing price floors or ceilings to prevent security prices from being too low or too high.

User Contributed Comments 4

User Comment
johntan1979 Is C even legal?
To-be-CFA @Johntan1979: It's legal, though not that prevalent.
farhan92 e.g minimum unit price on alcohol
ascruggs92 C is done by the government (i.e. currency pegs), not the financial system. Financial system will let things go to zero if nobody buys
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Colin Sampaleanu

Colin Sampaleanu

Learning Outcome Statements

explain the main functions of the financial system

CFA® 2025 Level I Curriculum, Volume 3, Module 1.