Question 3 ii. Briefly describe three different classifications of financial markets. [3 marks) What are financial intermediaries and what economic functions do they perform? [2 marks] Retained earnings provide the bulk of capital needs of businesses, hence securities markets are largely redundant. Discuss Briefly. [3 marks) iii. AQQ Aboagye, L. Mensah, E. K. Agbloyor, L. Amoah & B. Amoah Page 3 of 9 iv. In 2020, a telecommunication company recorded gross profit of GHC100,000. Let us assume that the company is financed by a combination of common stock and GHC800,000 of debt. The interest rate on the debt is 10 percent and the corporate tax rate is 35 percent. How much profit is available for common stockholders after payment of interest and corporate taxes? [3 marks] v. Briefly discuss two arguments in favour and against private placement of securities? [2 marks] vi. Explain two possible reasons why the cost of issuing debt may be lower that of the cost of issuing equity. [3 marks]