Match each role of financial intermediaries with the correct description (based
ID: 1164863 • Letter: M
Question
Match each role of financial intermediaries with the correct description (based on the book AND the(6pts) Chapter Comments). 4) Banks screen loan applicants and monitor loan recipients. V Select One Providing liquidity Collecting and processing information. Pooling savings Lowering transactions costs borrow from lots of people and lend to a much smaller number of borrowers. Bank assets have a longer maturity than their liabilities.Safekeeping, payments system access and accounting Diversifying risk It is cheaper to open a checking or saving account than it is to buy bonds and stocks. serecrune Banks hold more and different risky assets than anySelect One individual can. Banks offer ATM machines, safe-deposit boxes and Select One monthly bank statements.Explanation / Answer
1. Banks screen loan applicants and monitor loan receipts - collecting and processing information.
2. They borrow from lots of people and lend to a much smaller number of borrowers - Pooling savings
3. Bank assets have a longer maturity than their liabilites - Providing liquidity
4. It is cheaper to open a checking or saving account than it is to buy bonds and stocks - Lowering transactions cost
5. Banks hold more and different risky assets than any individual can - Diversifying risks.
6. Banks offer ATM machines, safe-deposit boxes and monthly bank statements - Safekeeping, payments system access and accounting.