QUESTION 21

The financial system is made up of financial institutions, instruments and markets.

(a) Explain the major role of a financial system. (2 marks)

(b) Name and briefly explain the three major types of financial instruments that make up the financial system. (3 marks)

(c) Name a type of non-bank financial institution, explain the role of your non-bank financial institution in the financial system and provide an example of both a source of funds and a use of funds for the non-bank financial institution you have named. (5 marks)