Question

Apply accounting terminology correctly Prepare transactions according to the Generally Accepted Accounting Principles. Compare and contrast...

Apply accounting terminology correctly Prepare transactions according to the Generally Accepted Accounting Principles. Compare and contrast the size of the bond market to the stock market in the United States. Which is bigger and why do you think this is?

Homework Answers

Answer #1

In the United States bond market is much bigger in size when compared to stock markets. Bond market is estimated to have a size of $40 trillion in the country while the stock market is almost half of this with around a size of less than $20 trillion.

In terms of trading volume as well bond market in USA surpasses the stock market in USA. The daily trading volume in US bond market is around $700 billion while the daily trading volume in the stock market in US is around $200 billion.

The reason for the bond market being much larger in size and scope than the stock market in USA is the long-term trend toward lower rates that has made financing through bonds cheaper for both corporate entities as well as governmental entities.

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