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A Financial Intermediary Specializes in Knowing About People Who Apply

question 110

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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:

Distributive Property

A property indicating that a(b+c) equals ab + ac, applicable for multiplication over addition or subtraction.

Associative Property

A mathematical rule stating that the way in which numbers are grouped in addition or multiplication does not change their sum or product.

Terms

Components of an expression or equation, separated by plus or minus signs, representing quantities or variables.

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