Savers May Prefer to Use Financial Intermediaries Rather Than Lending

question 59

Multiple Choice

Savers may prefer to use financial intermediaries rather than lending directly to borrowers because financial intermediaries:

• A)reduce the cost of gathering information about borrowers.
• B)have a monopoly on lending.
• C)increase the risk of lending.
• D)offer higher rates of return than available elsewhere.

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Definitions:

Living Conditions

The social and environmental factors that contribute to the quality and manner of a person's daily life and wellbeing.

Stress

A physical, mental, or emotional factor that causes bodily or mental tension, often resulting from demanding circumstances.

Parasites

Organisms that live on or inside another organism (the host) and benefit at the host's expense, often causing harm.

Antigens

Substances, usually proteins, on the surface of bacteria, viruses, and other foreign substances, that trigger an immune response in the body.