Transactions costs are
A) zero in financial markets.
B) zero in financial intermediaries.
C) the costs of direct financial transactions.
D) equal to the taxes imposed on financial transactions.

Question

Quizplus · Accepted Answer

Transactions costs refer to the expenses of engaging in direct financial transactions such as the cost of transferring money from one bank account to another or the cost of buying and selling securities. Financial markets and intermediaries may also have transactions costs, but they are not zero. The taxes imposed on financial transactions are not necessarily equal to transactions costs.

Transactions Costs Are