Question

SUBJECT : ACCOUNTING & FINANCE

Question 3

A market is a place where the buyer would meet the seller and perform transactions.

Explain the workings of the “share market”.

[8 marks]

Question 4

Risks are part and parcel of investing.

Propose methods generally used to manage risk by any potential investor.

[8 marks]

Answer 1

3.The concept behind how the stock market works is pretty simple. Operating much like an auction house, the stock market enables buyers and sellers to negotiate prices and make trades. ... Investors can then buy and sell these stocks among themselves, and the exchange tracks the supply and demand of each listed stock

4.

In the world of risk management, there are four main strategies:

Avoid it.

Reduce it.

Transfer it.

Accept it.

Each strategy has its own advantages and disadvantages, and you’ll probably end up using all four. Sometimes it may be necessary to avoid a risk, and other times you’ll want to reduce it, transfer it, or simply accept it. Let’s look at what those terms mean, and how to decide on the right classification to use for each of your own business risks.