Which of the following is not a benefit associated with financial intermediaries?
A) reduced costs
B) fund indivisibility
C) financial flexibility
D) diversification of risk

Question

Quizplus · Accepted Answer

Fund indivisibility is actually a problem that financial intermediaries aim to solve, rather than a benefit they provide. Financial intermediaries can pool together small amounts of funds from savers and invest them in large, productive projects that would otherwise be too costly or risky for individual savers to invest in directly, thereby solving the problem of fund indivisibility. The benefits associated with financial intermediaries include reduced costs, financial flexibility, and diversification of risk.

Which of the Following Is Not a Benefit Associated with Financial