What role does the stock market play in a market economy? It provides businesses with money for growth in exchange for shares of ownership. It provides the government with money in exchange for the ability to vote on upcoming bills. Stock markets generally do not exist in market economies. It provides individuals with loans which they can pay back at a later time with little to no interest.

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Jaslene

28 July, 15:11

What role does the stock market play in a market economy? It provides businesses with money for growth in exchange for shares of ownership. It provides the government with money in exchange for the ability to vote on upcoming bills. Stock markets generally do not exist in market economies. It provides individuals with loans which they can pay back at a later time with little to no interest.

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Kenley Hayden · Answer 1

It provides businesses with money for growth in exchange for shares of ownership. You sell a part of you company for cash at the stock exchange. Because now someone else owns a part of your company they (the shareholder) need to get a return for that which is normally a part of the yearly profit which is called dividend when we talk about shares. The benefit for the company is that they get cash by selling a part of the company and can invest that money in the company to make more profit. As such, a company only sells shares if they think they can grow with the money they recieve in exchange for the shares.