Individual investors can reduce transactions costs by
A) buying common stock rather than bonds.
B) combining their purchases through an intermediary.
C) purchasing common stocks directly, rather than through a mutual fund.
D) making loans directly, rather than depositing funds in a bank.

Question

Quizplus · Accepted Answer

By combining their purchases through an intermediary, individual investors can benefit from lower transactions costs as the intermediary can negotiate better fees and spreads with brokers and other intermediaries. This can help to minimize expenses and improve overall returns for the investor.

Individual Investors Can Reduce Transactions Costs by