Questions: Financial intermediation is the process in which: financial institutions act as intermediaries between the suppliers and demanders of funds Thrift institutions were formed specifically to encourage household savings and to: make home mortgage loans The three principal tools of the Federal Reserve System are:

Financial intermediation is the process in which:
financial institutions act as intermediaries between the suppliers and demanders of funds

Thrift institutions were formed specifically to encourage household savings and to:
make home mortgage loans

The three principal tools of the Federal Reserve System are:
Transcript text: Financial intermediation is the process in which: financial institutions act as intermediaries between the suppliers and demanders of funds Thrift institutions were formed specifically to encourage household savings and to: make home mortgage loans The three principal tools of the Federal Reserve System are:
failed

Solution

failed
failed

Question 3:
The answer is the last one: financial institutions act as intermediaries between the suppliers and demanders of funds.
Explanation:

  • The Financial Reserve controls the supply of money: This is incorrect because financial intermediation specifically refers to the role of financial institutions, not the control of money supply.
  • Discount rates are interpreted: This is incorrect as discount rates are related to monetary policy, not directly to financial intermediation.
  • Savings are automatically deducted from checking accounts: This is incorrect as it describes a banking service, not financial intermediation.
  • The Federal Reserve establishes the prime rate: This is incorrect because setting the prime rate is a function of monetary policy, not financial intermediation.
  • Financial institutions act as intermediaries between the suppliers and demanders of funds: This is correct as financial intermediation involves institutions like banks facilitating the flow of funds from savers to borrowers.

Question 4:
The answer is the second one: make home mortgage loans.
Explanation:

  • Manage investment portfolios: This is incorrect as thrift institutions primarily focus on savings and loans, not investment management.
  • Make home mortgage loans: This is correct because thrift institutions, such as savings and loan associations, were traditionally established to provide home mortgage loans.
  • Provide time and demand deposits: This is incorrect as it describes a function of banks in general, not specifically the purpose of thrift institutions.
  • Make consumer loans: This is incorrect as the primary focus of thrift institutions is on home mortgages, although they may offer consumer loans as well.
  • Make business loans: This is incorrect as thrift institutions are more focused on household savings and home loans rather than business loans.

Question 5:
The question is not answered as per the guidelines provided.

Was this solution helpful?
failed
Unhelpful
failed
Helpful