MANAGEMENT

BUISENESS MANAGEMENT

FINANCIAL MANAGEMENT

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Of the following, which is NOT an activity engaged in by a financial intermediary?

A	Matching borrowers and lenders
B	Bearing risk
C	Managing retirement portfolios for large classes of employees
D	All of the above are activities of financial intermediaries.

Explanation:

Detailed explanation-1: -Answer and Explanation: The stock market, bond market, and banks are all financial intermediaries but the government is not. The government is not a financial intermediary but it has become involved in financial intermediation.

Detailed explanation-2: -Financial intermediaries move funds from parties with excess capital to parties needing funds. The process creates efficient markets and lowers the cost of conducting business. For example, a financial advisor connects with clients through purchasing insurance, stocks, bonds, real estate, and other assets.

Detailed explanation-3: -It does not provide a safekeeping service for those with excess funds.

Detailed explanation-4: -The institutions that are commonly referred to as financial intermediaries include commercial banks, investment banks, mutual funds, and pension funds.

There is 1 question to complete.