Stock Exchange works as a mechanism for the valuation of securities through the forces of demand and supply. Identify the related function performed by the stock exchanges.
Answer & explanation
Correct answer: option 3
Pricing of Securities: Share prices on a stock exchange are determined by the forces of demand and supply. A stock exchange is a mechanism of constant valuation through which the prices of securities are determined. Such a valuation provides important instant information to both buyers and sellers in the market.