Which of the Following Is an Example of Financial Intermediation

question 124

Multiple Choice

Which of the following is an example of financial intermediation?

• A)John buys shares of stock issued by a fast food company.
• B)A foreign government buys bonds issued by the U.S.Treasury.
• C)Susan makes a deposit at a bank and the bank uses this money to make an auto loan to Ferguson.
• D)None of the above is correct.

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Definitions:

Marginal Costs

The escalation in cumulative costs incurred by manufacturing an additional unit of a good or service.

Linear Demand Curve

A graphical representation showing a straight-line relationship between the price of a good and the quantity demanded.

Quasi-Fixed Costs

Costs that are not directly tied to the level of production or output, such as salaries or rent, which remain somewhat constant until a significant change in operations occurs.

Total Cost Function

A mathematical expression that calculates the total cost of producing a given level of output, incorporating both fixed and variable costs.