According to Merton (1995), Financial Systems Perform Three Functions

question 18

True/False

According to Merton (1995), financial systems perform three functions.These are the settlement function, the flow of funds function and the risk-transfer function.

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Definitions:

Workers

Individuals engaged in any form of employment or labor.

Marginal Product

The additional output a firm produces as a result of hiring one more unit of a factor of production, such as labor or capital.

Bushel of Wheat

A measure of volume used in the U.S. to quantify agricultural commodities, equivalent to approximately 35.24 liters.

VMPL Curve

A graphical representation showing the value of the marginal product of labor, which changes as more labor is employed.