Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 18, Problem 1QR
To determine
The role of a financial system and the different financial markets and intermediaries.
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What is the financial system, Name and describe two markets that are part of the financial system in the U.S. economy. Name and describe two financial intermediaries.
Is an economy both social and a financial system?
What are the different Financial Intermediaries and explain how they carry out the objectives of the financial system?
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Essentials of Economics (MindTap Course List)
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- Which of the following explains the relevance of financial institutions? a. Financial institutions spur economic activity by providing credit for business expansion. b. Financial institutions create profits for depositors. c. Financial institutions allow governments to print money. d. Financial institutions provide the main source of funding for start-ups.arrow_forwardExplain the role that financial intermediaries play in an economy by giving a practical example.arrow_forwardWhich of the following is NOT TRUE about Financial Intermediaries? *A. Financial Intermediaries are institutions that serves as a bridge between the SSUs and DSUs.B. Financial Intermediaries makes the financial system more efficient.C. Financial Intermediaries earn profits through various transactions and services they offer.D. Financial Intermediaries offers investment advices.arrow_forward
- Which of the following is not a primary participant in the financial marketplace? a. governments b. businesses c. military units d. individual householdsarrow_forwardPlease discuss the following. 1. Financial markets are institutions and systems that facilitate transactions in all types of financial claims. 2. What is the importance of financial markets in a nation's economy? Discuss fully.arrow_forwardWhich of the following is TRUE about financial regulations? *A. Financial regulations makes the financial system organized, stable and maintain its integrity.B. Financial regulations are not always required in the financial system because financial institutions are already regulated by designated government agencies.C. Financial who are privately trading inside information are highly acceptable in the financial system.D. Financial regulations are laws that are not necessarily need to be enforced.E. None of the choices.arrow_forward
- One of the biggest problems for any economy is to figure out how to get or transfer money from people or firms who want to save (savers) to people or firms who want to borrow (investors). Explain how financial markets can help to solve this problem efficiently. Discuss how financial markets function and which tools they can offer to solve this problem. Discuss how financial systems are of crucial significance to adequate capital formation, which is indispensable to a speedy economic growth and development.arrow_forwardOne of the tasks of a Financial System include providing affordable loans to all consumers and firms.True or Falsearrow_forwardWhy is it so important to an economy to have fully developed financial markets?arrow_forward
- The following are the common characteristics of financial intermediaries, except: *a. Providers of loans.b. Maintains stability in the capital market.c. Making the investors rich.d. Providing investment advicearrow_forwardMatch each of the following players in the financial system with the financial product(s) they are most associated with. Instructions: You may select more than one answer. Click the box with a check mark for correct answers, and click to empty the box for the wrong answers. Players Financial product Stocks a. Commercial banks 2 Bonds ? Loans Stocks b. Savers Bonds 2 Loans Stocks c. Investment banks Bonds 2 Loansarrow_forwardIdentify which item is not one of the six parts of the financial system. a. Credit cards b. Financial institutions c. Central banks d. Financial marketsarrow_forward
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