The primary economic function of the financial system is to
A)keep interest rates low.
B)provide expert advice to savers and investors.
C)match one person's consumption expenditures with another person's capital expenditures.
D)match one person's saving with another person's investment.

Question

Quizplus · Accepted Answer

The primary economic function of the financial system is to match one person's saving with another person's investment, which is facilitated by financial intermediaries such as banks, mutual funds, and other financial institutions. This function helps allocate resources efficiently and promotes economic growth. The other options, such as keeping interest rates low or providing expert advice, are secondary functions of the financial system.

The Primary Economic Function of the Financial System Is to