Firms That Extend Credit to Borrowers Using Funds from Raised

question 8

Multiple Choice

Firms that extend credit to borrowers using funds from raised from savers are called:

• A)bond dealers.
• B)stock brokers.
• C)central banks.
• D)financial intermediaries.

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Definitions:

Negotiability

The quality of a financial instrument, such as a check or bill of exchange, that allows it to be transferred from one party to another through endorsement or delivery.

Traveler's Checks

Preprinted, fixed-amount checks designed to allow the person signing it to make an unconditional payment to someone else as a result of having paid the issuer for this privilege.

Negotiable

Capable of being transferred or exchanged for value by endorsement or delivery.

Countersignature

A second signature added to a document to verify or confirm its authenticity.