Financial intermediaries are important because
A. they increase costs for banks.
B. they employ large numbers of people.
C. they bring lenders and borrowers together in a way that lowers transaction costs.
D. they provide large funds to the stock market.
Answer: C
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Indicate whether the statement is true or false
A $100 increase in both government expenditure and taxes will
a. cancel each other out so that the equilibrium level of output will remain unchanged b. lead to a $100 decrease in the equilibrium level of output c. lead to a $100 increase in the equilibrium level of output d. lead to a greater than $100 increase in the equilibrium level of output e. lead to a less than $100 increase in the equilibrium level of output