Which of the following is NOT a part of the financial system?

The financial system comprises various components that facilitate the flow of funds and the functioning of financial markets. Money, central banks, and regulatory agencies all play crucial roles within this system.

Money serves as a medium of exchange, a unit of account, and a store of value, making it a foundational element of any financial system. Central banks are vital as they manage a nation's currency, control monetary policy, and oversee financial stability. Regulatory agencies are responsible for enforcing laws and regulations that aim to ensure the integrity and stability of the financial system, protecting investors and maintaining public confidence.

In contrast, although investors are critical participants in the financial markets—actively buying and selling assets—the concept of the financial system is broader and more structural. Investors themselves do not constitute a part of the system's framework; they engage with the components of the system. Therefore, identifying investors as a separate entity that does not belong to the financial system aligns with the concept of the other elements that facilitate it. Understanding this distinction helps clarify the roles and interactions within the financial ecosystem.