ECONOMICS
FINANCIAL MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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investment objective
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secondary market
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primary market
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financial intermediary
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Detailed explanation-1: -A financial intermediary is a financial institution that collects funds from savers and then invests these funds in loans and other financial assets.
Detailed explanation-2: -Banks as Financial Intermediaries Banks act as financial intermediaries because they stand between savers and borrowers. Savers place deposits with banks, and then receive interest payments and withdraw money. Borrowers receive loans from banks and repay the loans with interest.
Detailed explanation-3: -Financial markets are the institutions through which savers can directly provide funds to borrowers.
Detailed explanation-4: -The most common types of financial institutions are commercial banks, investment banks, insurance companies, and brokerage firms. These entities offer a wide range of products and services for individual and commercial clients such as deposits, loans, investments, and currency exchange.