In the Lending/borrowing Process,a Financial Intermediary Function Is to Bear

question 94

True/False

In the lending/borrowing process,a financial intermediary function is to bear the risk that the borrower will not repay.

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Definitions:

Snob Effect

Negative network externality in which a consumer wishes to own an exclusive or unique good.

Bandwagon Effect

Positive network externality in which a consumer wishes to possess a good in part because others do.

Network Externalities

Benefits or detriments to a product's value that result from the number of users the product has.

Negative Network Externalities

Adverse effects on a user of a product or service because the number of other users is too large or incompatible in some way.