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A Financial Intermediary Specializes in Knowing About People Who Apply

question 110

Multiple Choice

A financial intermediary specializes in knowing about people who apply for loans.The intermediary knows how to evaluate credit histories and the probabilities that borrowers will repay.These facts are examples of which of the following functions of financial intermediaries?


Definitions:

Profit Center

A decentralized unit in which the manager has the responsibility and the authority to make decisions that affect both costs and revenues (and thus profits).

Department Manager

An individual responsible for overseeing the operations, staff, and performance of a specific department within an organization.

Authority

The power or right to give orders, make decisions, and enforce obedience.

Cost Center

A decentralized unit in which the department or division manager has responsibility for the control of costs incurred and the authority to make decisions that affect these costs.

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