Which of the following statements is FALSE?

Question

BlackTom AI · Accepted Answer

First, consider the context: financial intermediaries are institutions like banks, mutual funds, or insurance companies that connect savers and borrowers and perform various roles in the financial system.

Option A: 'A financial intermediary benefits society by providing a mechanism for payments.' This is true, since intermediaries facilitate payment systems (checking, transfer services, payment rails) which support commerce and economic activity.

Option B: 'A financial intermediary reduces its risk exposure by pooling its assets.' This is generally correct: diversification and pooling risk across many loans or assets helps reduce individual exposure and smooths returns.

Option C: 'A financial intermediary acts as a lender of last resort.' This statement is false in most standard financial theory and practice. Lenders of last resort responsibilities typically belong to central banks or, in some cases, government-backed institutions during systemic crises. Private financial intermediaries do not routinely act as lenders of last resort to the broader economy; they manage liquidity and credit risk rather than guarantee a final liquidity backstop for everyone.

Option D: 'A financial intermediary specializes in the production of information.' This is true in many cases: intermediaries collect, process, and disseminate information (credit assessment, ratings, research) to reduce information asymmetry between savers and borrowers.

Option E: 'A financial intermediary may act as a broker to bring together funds deficit and funds surplus units.' This is a correct description of many intermediaries, who facilitate matching between those who have excess funds and those who need funds (e.g., brokers, investment banks, mutual funds).

In summary, every option except C aligns with well-established roles of financial intermediaries, whereas C misstates a core function and is thus incorrect.

FINS5530-Financial Institution Mgmt - T3 2025

Which of the following statements is FALSE?

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Financial intermediaries are[Fill in the blank]

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FINS5530-Financial Institution Mgmt - T3 2025

Which of the following statements is FALSE?

查看解析

登录即可查看完整答案

类似问题

Financial intermediaries are[Fill in the blank]

Part 1Which of the following is not an important financial intermediary in the​ economy? A. Commercial banks. B. Mutual funds. C. The Fed. D. Finance companies.

Part 1 Financial intermediaries LOADING... have a role to play in matching savers and borrowers for all of the following reasons except​:Part 2 A. economies of scale B. risk sharing C. information symmetries D. minimising transaction costs

Part 1Which of the following is not an important financial intermediary in the​ economy? A. Mutual funds. B. Commercial banks. C. The central bank. D. Pension funds.

Which of the following is NOT a major function of financial intermediaries?

Which function of a financial intermediary reduces transaction and information costs between a corporation and individual which may encourage a higher rate of savings?

Which of the following is NOT a reason for the specialness of financial intermediaries?

Banks a. play no role in the financial system. b. are financial intermediaries c. are financial markets, as are bond markets. d. All of the above are correct.

更多留学生实用工具

希望你的学习变得更简单

Part 1Which of the following is not an important financial intermediary in the economy? A. Commercial banks. B. Mutual funds. C. The Fed. D. Finance companies.

Part 1 Financial intermediaries LOADING... have a role to play in matching savers and borrowers for all of the following reasons except:Part 2 A. economies of scale B. risk sharing C. information symmetries D. minimising transaction costs

Part 1Which of the following is not an important financial intermediary in the economy? A. Mutual funds. B. Commercial banks. C. The central bank. D. Pension funds.