Question

In: Finance

Which of the following statements is FALSE regarding financial intermediaries? A. A stock broker acts as...

Which of the following statements is FALSE regarding financial intermediaries?

A. A stock broker acts as a financial intermediary by bringing together buyers and sellers of stocks.

B. A financial advisor is a financial intermediary since he/she gives financial advice to households regarding saving for retirement.

C. Banks and credit unions are a financial intermediaries since they act as a middle man between households wanting to borrow and those wanting to lend .

D. Investment companies act as a financial intermediary by pooling investors' funds enabling those with smalls sums of money to obtain diversified portfolios.

E. Insurance companies act as financial intermediaries by pooling risk amongst households thereby reducing the cost of insuring such risks.

Solutions

Expert Solution

Answer:

Broadly,Financial intermediary is a third party facilitates a transactions between a borrower and a lender.Accordigly,financial advisor who gives financial advice to households regarding saving for retirement cannot be considered as financial intermediary.Thus correct answer is Option B

All the remaining options are true regarding financial intermediaries.


Related Solutions

Which of the following is correct regarding financial intermediaries? Multiple Choice Financial intermediaries specialize in assessing...
Which of the following is correct regarding financial intermediaries? Multiple Choice Financial intermediaries specialize in assessing the risk of optimization. Financial intermediaries specialize in assessing the risk of default. Financial intermediaries specialize in assessing risk of profitability. Financial intermediaries specialize in assessing the risk of succes
Which of the following is most FALSE regarding the geneticsubstrate (variation) on which selection acts?...
Which of the following is most FALSE regarding the genetic substrate (variation) on which selection acts?Group of answer choicesInbreeding, caused by genetic drift, results in a high level of homozygosity in a populationSex creates new combinations of genotypesGenetic drift could reduce the levels of allelic and genotypic variationMutations are a source of allelic variationEpigenetic modifications give rise to allelic diversity
Regarding the differences between financial accounting and management accounting, which of the following statements is false?...
Regarding the differences between financial accounting and management accounting, which of the following statements is false? Select one: a. management accounting is less constrained than financial accounting b. the distinction between the two areas, to some extent, reflects differences in access to financial information c. there is no overlap between management accounting and financial accounting d. managers have much more control over the form and content of their reports
Which of the following statements is false regarding a general partnership?
Which of the following statements is false regarding a general partnership?A.It is easy to create.B.Income of the business is personal income.C.Business losses can be deducted from taxes.D.The partners are considered agents of the partnership.E.In most cases partners do not have personal liability for losses.
Which of the following statements is false regarding credit risk analysis?
Which of the following statements is false regarding credit risk analysis?Multiple ChoiceA lender is protected against credit risks by a loan’s covenant provisions since the interest rate is fixed by the Federal Reserve Bank.High-quality financial statements help a credit analyst to see the true performance at a company.Greater default risk is determined to exist when there is significant organizational reliance on a certain individual or customer.An estimate of a firm’s future financial condition is very important to most lending decisions.
Which of the following statements regarding Lewis dot symbols of ions is false? Which of the...
Which of the following statements regarding Lewis dot symbols of ions is false? Which of the following statements regarding Lewis dot symbols of ions is false? Mg2+ always has one electron around it. In ionic compounds containing chloride, ions, Cl− is isoelectronic with Ar. In magnesium sulfide, S2− has eight electrons. In sodium chloride, Na+ has no electrons around it.
Which of the following statements regarding t and z distributions is/are true? Correctany false statements to...
Which of the following statements regarding t and z distributions is/are true? Correctany false statements to make them true. A) The area under a t-distribution to the left of -1.97 is greater than the area to the right of 2.17 for a sample of any size. B) The area under the curve (AUC) to the right of t=2.00 when n=15 is smaller than the AUC to the right of t=2.00 when n=50. C) The t-curve has thinner tails and a...
Which of the following statements are FALSE regarding the Lewis structures of XeFO3- and XeFO3+ ?...
Which of the following statements are FALSE regarding the Lewis structures of XeFO3- and XeFO3+ ? Question options: The octet rule is violated in XeFO3+. There is a formal charge on O in XeFO3+. There is a formal charge on O in XeFO3-. The Xe atom in XeFO3+ has a single non-bonding electron pair. The xenon atom in XeFO3- has a single non-bonding electron pair.
Which of the following are false regarding financial instruments and money a) Financial instruments can function...
Which of the following are false regarding financial instruments and money a) Financial instruments can function as a means of payment and a store of value b) Money can function as a means of payment and a store of value c) Financial instruments allow for the transfer of risk between buyer and seller. d) Money allows for the transfer of risk between buyer and seller.
Which one of the following statements regarding exchange-traded funds (ETFs) is false?
Which one of the following statements regarding exchange-traded funds (ETFs) is false? The ETFs offer clients professional investment management and advice. The ETFs trade at a price close to NAV. The number of shares in the ETFs can change over time Most ETFs track an index
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT