Final answer:
The correct answer is D. Management of the nation's money supply is not a major function of financial intermediaries. Financial intermediaries primarily perform brokerage service, asset transformation services, information production, and administration of payment mechanisms.
Step-by-step explanation:
The correct answer is D. Management of the nation's money supply is not a major function of financial intermediaries. Financial intermediaries such as banks primarily perform the following major functions:
- Brokerage service: Financial intermediaries act as intermediaries in financial markets, facilitating the buying and selling of financial assets, such as stocks and bonds.
- Asset transformation services: They transform and repackage assets to meet the needs of both savers and borrowers. This involves accepting short-term deposits from savers and providing long-term loans to borrowers.
- Information production: Financial intermediaries collect and analyze information about borrowers to assess their creditworthiness and make informed lending decisions.
- Administration of payment mechanisms: Financial intermediaries provide payment services, such as processing checks and facilitating electronic funds transfers, to facilitate the smooth flow of transactions.
While financial intermediaries indirectly influence the management of the nation's money supply through their lending and deposit activities, it is not their primary function.