How the financial intermediary is an asset transformer

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Reference no: EM131797342

Question: Suppliers of funds (Savers) have the option of purchasing financial assets such as stocks and bonds directly in the marketplace - or they can choose to use the services of a financial intermediary such as a Commercial Bank.

a) Describe how the financial intermediary is an "asset transformer."

b) Discuss the important benefits provided to the suppliers of funds by the financial intermediary.

c) Discuss the major disadvantage for the suppliers of funds when using a financial intermediary?

Reference no: EM131797342

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