Direct finance requires a more or less exact match of preferences between DSUs and SSUs

Question

Quizplus · Accepted Answer

Direct finance involves financial transactions where deficit spending units (DSUs) borrow directly from surplus spending units (SSUs) without the intermediation of financial institutions. This process requires a close match of preferences regarding the amount, maturity, and risk between the borrowers (DSUs) and the lenders (SSUs) to facilitate a direct transaction.

Direct Finance Requires a More or Less Exact Match of Preferences