A primary function of banks is to:
A) expand the creation of money.
B) spread the risks from investments to a wide range of savers.
C) match saving flows with real investment flows in an economy.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

Banks expand the creation of money through their lending activities, spread the risks from investments to a wide range of savers through their diversification strategies, and match saving flows with real investment flows in an economy through their intermediation activities. Therefore, all three options are correct.

A Primary Function of Banks Is To