Part A) The korea's economy is the mixed economy, Owing to very fast pace of changing the status from developing to developed economy, they are registered there name in OECD. Due to supporting environment, various countries are willing to invest the fund for business, as support of primary market. Thus owing to mixed economy, developed country, well climate, less political interference, well support of political leaders, well international trade scheme, south Korea's environment favour investing activities.
All factor remaining the same due to secondary market, and of mixed economy, the south Korea's environment support the indexing.
The fund invests in equities, fixed income, hedge funds, private equity, and real estate and infrastructure.
And fund indexing are stocks and bonds,stocks and bonds.
GAC should invest in South Korea actively or by indexing both
Part B) The statement is False. Secondary markets make securities liquid, and help issuers of securities in primary markets determine the prices of newly-issued securities.
Thus The secondary market plays an important role in providing the liquidity and determine the price of new securities issued in the primary market.
Primary markets are place where the securities are issued for the first time and funds are raised by the companies. Secondary markets are place where the securities and assets are resold.
Secondary markets are important for the economy. When a security is bought and sold in the secondary market, the company does not get any additional funds. The individual selling the security is benefited from the trade.