The Process of Balancing Savings Surplus and Savings Deficit Units

question 32

Multiple Choice

The process of balancing savings surplus and savings deficit units by channeling savings into investment through a financial intermediary does not result in the:

• A)individuals receiving safety of principal, liquidity, and a return on their savings
• B)business firm anticipating earning a return on its investment in real assets that is lower than the interest cost on the institution loan
• C)intermediary being compensated for facilitating the savings and investment process
• D)creation of two types of financial assets and two types of financial liabilities

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