Financial Intermediaries Are Able to Exploit Economies of Scale Since

question 66

Multiple Choice

Financial intermediaries are able to exploit economies of scale since

• A) the equipment or expertise necessary for one transaction can be applied to other transactions.
• B) they have special licenses needed to perform financial transactions.
• C) financial markets fail to do so.
• D) they can reduce transactions costs, but not information costs.

Learn the techniques for highlighting a document's organizational structure.

Appreciate the ethical considerations in comparative writing.

Understand the impact of organizational choices on reader's ease of access to information.

Recognize the effectiveness of the general-to-specific pattern for clarity.

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholders from its profits in the form of cash.

Financing Activities

Transactions related to raising capital and repaying investors, including debt, equity, and dividends.

Common Stock

Common stock represents ownership shares in a corporation, giving holders voting rights and a residual claim on corporate earnings in the form of dividends.

Indirect Method

The indirect method is a way of preparing the cash flow statement in which net income is adjusted for changes in balance sheet accounts to compute the cash flow from operating activities.