Which of the following is NOT a comparative advantage of financial intermediaries over surplus spending funds in providing funds to deficit spending units?
A)Ability to increase credit risk.
B)Ability to reduce transaction costs.
C)Ability to achieve economies of scale.
D)Ability to find confidential information.

Question

Quizplus · Accepted Answer

Financial intermediaries typically have the ability to reduce credit risk, not increase it. They achieve this by diversifying their portfolios and using their expertise to assess and manage risk.

Which of the Following Is NOT a Comparative Advantage of Financial