Savers may prefer to use financial intermediaries rather than lending directly to borrowers because financial intermediaries:
A)reduce the cost of gathering information about borrowers.
B)have a monopoly on lending.
C)increase the risk of lending.
D)offer higher rates of return than available elsewhere.

Question

Quizplus · Accepted Answer

Gathering information about borrowers is time consuming and expensive. By using a financial intermediary, small savers do not have to worry about gathering information.

Savers May Prefer to Use Financial Intermediaries Rather Than Lending