What crucial role do financial intermediaries perform in an economy?
What will be an ideal response?
Financial intermediaries borrow funds from people who have saved and make loans to other individuals and businesses and thus improve the efficiency of the economy.
You might also like to view...
If an economy has successful assigned policies under a fixed exchange regime, what will they have to do if they choose a new floating exchange regime?
A) Switch which agency is focused on internal vs. external balance. B) nothing C) Watch closely for signs of inflation which may trigger a policy misalignment problem. D) The answer is dependent upon their level of capital mobility which is unknown.
What is it called when a third party of empowered to resolve a disagreement it is called?
a. negotiation b. grievance c. arbitration d. mediation
In a monopolistically competitive market,
a. entry by new firms is impeded by barriers to entry; thus, the number of firms in the market is never ideal.
b. entry by new firms is impeded by barriers to entry, but the number of firms in the market is nevertheless always ideal.
c. free entry ensures that the number of firms in the market is ideal.
d. there may be too few or too many firms in the market, despite free entry.
The most desirable inflation rate is the rate that
A. Maximizes the "wealth effect" of inflation. B. Has the least effect on the behavior of companies, investors, consumers, and workers. C. Coincides with an unemployment rate of 0 percent. D. Equals the official goal of 3 percent.