Financial intermediaries
a. harm both borrowers and lenders because they pay lenders a lower rate of interest than they charge to borrowers
b. specialize in assembling loanable funds from households and firms, and channeling those funds to other households, firms, and government agencies
c. are all depository institutions
d. increase the risk of lending and borrowing because a financial intermediary has nothing to lose from such transactions
e. reduce efficiency because they add an extra step to many financial transactions
B
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The M1 definition of the money supply includes:
a. currency in circulation and checkable deposits. b. Federal Reserve Notes, gold certificates, and checkable deposits. c. Federal Reserve Notes and bank loans. d. None of these.
Refer to the graphs below. They show the long-run average total cost (LRATC) for a product. For which graph would a firm experience first economies and then diseconomies of scale over its range of output?
A. Graph A
B. Graph B
C. Graph C
D. Graph D