One reason that financial intermediaries exist is that they:
A. earn high returns from lending their own funds.
B. are the only way to obtain information.
C. have developed low-cost methods to obtain information.
D. are required by government regulation.
Answer: C
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A firm's market constraints include the conditions under which it can
A) convert inputs into outputs. B) buy its inputs and sell its outputs. C) issue stock. D) produce the inputs to production.
A credit market instrument that provides the borrower with an amount of funds that must be repaid at the maturity date along with an interest payment is known as a
A) simple loan. B) fixed-payment loan. C) coupon bond. D) discount bond.
Savings deposits and time deposits are not included in M1 because these are not held by the nonbanking public
a. True b. False Indicate whether the statement is true or false
Pat used to work as an aerobics instructor at the local gym earning $35,000 a year. Pat quit that job and started working as a personal trainer. Pat makes $50,000 in total annual revenue. Pat's only out-of-pocket costs are $12,000 per year for rent and utilities, $1,000 per year for advertising and $3,000 per year for equipment. For Pat to earn normal profit, Pat's accounting profit would have to be ________.
A. 0 B. $35,000 C. $50,000 D. $15,000