Final answer:
Investment banks serve as intermediaries in the primary market, underwriting securities from issuers and selling them to investors while acting as a conduit for funds between savers and borrowers.
Step-by-step explanation:
The primary market is intermediated by investment banks, which buy securities from the issuer and sell them to individuals and funds. An intermediary, in the financial context, is an institution that acts as a middleman between savers and borrowers, channeling funds from those who want to save money to those who want to borrow. In the case of the primary market, investment banks serve this intermediary role by underwriting securities, which means they assume the risk of selling the issued securities to the public and in return, they receive a fee for their services. As financial intermediaries, banks pool together the savings of individuals and lend to businesses and other entities in need of capital for growth and expansion.