Question

Which of the following statements is FALSE?a.A financial intermediary specializes in the production of information.b.A financial intermediary reduces its risk exposure by pooling its assets.c.A financial intermediary benefits society by providing a mechanism for payments.d.A financial intermediary may act as a broker to bring together funds deficit and funds surplus units.e.A financial intermediary acts as a lender of last res

Answer 1

The answer is E.

Step-by-step explanation:

Only the option E is wrong.

A Financial intermediaries are commercial banks, investment banks, insurance companies etc. Only the Central bank of every nation acts as a lender of last resort. This means it renders help to financial intermediaries when their liquidity position is in question or in danger.

For example, in U.S, Reserve Bank or the Bank of England in Great Britain acts as the bank of last resort. They are the central bank.