diversify their portfolios
gather all relevant information
assess credit risk of borrowers
advertise for needed investments E. all of above
Answer is Wrong!
Answer is Right!
The correct answer is: E. all of the above
Financial intermediaries exist because small investors cannot efficiently:
- Diversify their portfolios. Diversification is the process of spreading your money across different types of investments to reduce risk. It is difficult and expensive for small investors to do this on their own, but financial intermediaries can do it for them.
- Gather all relevant information. It is difficult and time-consuming for small investors to gather all the information they need to make informed investment decisions. Financial intermediaries have the resources to do this for them.
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