Question

How does the Capital Market contribute to financial risk management?

a.

Identifying and analyzing financial risk

b.

Diversification and transfer of risk

c.

Mobilizing funds to business houses

d.

Encouraging corporate governance principles

Posted under IC 89 Management Accounting

Answer: (b).Diversification and transfer of risk Explanation:The Capital Market contributes to financial risk management through the identification, analysis, and diversification or transfer of financial risk.

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