In January 2025
Answer to Question #232983 in Macroeconomics for tashie
Discuss the fact that savers prefer channeling their funds through financial intermediaries than lending them directly to borrowers. [12]
Funds flow directly or indirectly through financial institutions from ultimate lenders to ultimate borrowers. Because financial intermediaries lower the cost of acquiring information about borrowers, savers may opt to use them rather than loan directly to borrowers.
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