What Do We Call Financial Institutions Through Which Savers Can

question 4

Multiple Choice

What do we call financial institutions through which savers can indirectly provide funds to borrowers?

• A)stock markets
• B)financial institutions
• C)financial markets
• D)financial intermediaries

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Definitions:

Central Bank

An institution that manages a country's currency, money supply, and interest rates. Central banks also oversee the commercial banking system of their respective countries.

Sacrifice Ratio

The sacrifice ratio measures the cost of reducing inflation in terms of the percentage of GDP lost per each percentage point decrease in inflation.

Volcker Disinflation

A period during the early 1980s when the Federal Reserve, led by Chairman Paul Volcker, raised interest rates to historically high levels in order to combat high inflation.

Estimates

Approximations or educated guesses based on current trends and data.