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

question 92

Multiple Choice

According to Merton (1995) , financial systems perform six functions.The function performed by the payment system is:

• A)to provide the means for the settlement of commercial transactions
• B)to arrange the flow of funds from surplus to deficit units
• C)to provide ways for participants in the financial system to transfer and manage risk
• D)to promote the pooling of funds
• E)to provide ways of dealing with the incentive problems that arise in financial contracting.