Many market participants interact with financial institutions to organize the exchange of funds between surplus units and deficit units. Such institutions
include commercial banks, credit unions, insurance companies, mutual funds, pension funds, savings institutions, and securities firms. These
institutions play key roles in facilitating the flow of funds between surplus units and deficit units.
Which of the following are key roles of financial institutions? Check all that apply.
? They serve as activist shareholders which allows them to monitor publicly traded firms.
? They take on riskier loans, knowing they could default.
? They provide surplus units with full information within markets, completely removing information asymmetry from financial markets.
? They offer deposit accounts that fit the needs of surplus units.
