Financial intermediaries reduce the costs of negotiation by
A) pooling funds.
B) gaining expertise in evaluating and monitoring investments.
C) investing in a large number of projects with independent returns.
D) investing in a small number of projects with independent returns.

Question

Quizplus · Accepted Answer

Financial intermediaries pool funds from many investors, which reduces the costs of negotiation by spreading them over a larger base.

Financial Intermediaries Reduce the Costs of Negotiation by