A depository institution and its types. Role of depository institution, as intermediaries between savers and borrowers. Concept Introduction: Depository institutions are bank, building society, credit union, or other financial institution that solicits and accepts savings of the general public as demand deposits or time deposits, and pays a fixed or variable rate of interest.

Question

One of the biggest problems for any economy is to figure out how to get or transfer money from people or firms who want to save (savers) to people or firms who want to borrow (investors). Explain how financial markets can help to solve this problem efficiently. Discuss how financial markets function and which tools they can offer to solve this problem. Discuss how financial systems are of crucial significance to adequate capital formation, which is indispensable to a speedy economic growth and development.

Answer 1

Question

Chapter 13, Problem 2.7P

To determine

A depository institution and its types. Role of depository institution, as intermediaries between savers and borrowers.

Concept Introduction:

Depository institutions are bank, building society, credit union, or other financial institution that solicits and accepts savings of the general public as demand deposits or time deposits, and pays a fixed or variable rate of interest.

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Students have asked these similar questions

One of the biggest problems for any economy is to figure out how to get or transfer money from people or firms who want to save (savers) to people or firms who want to borrow (investors). Explain how financial markets can help to solve this problem efficiently. Discuss how financial markets function and which tools they can offer to solve this problem. Discuss how financial systems are of crucial significance to adequate capital formation, which is indispensable to a speedy economic growth and development.

Karrie is a golf pro, and after she paid taxes, her income from golf and her interest from financial assets totalled $2,500,000 in 2019. At the beginning of 2019, she owned $1,100,000 worth of financial assets. At the end of 2019, Karrie's financial assets were worth $1,300,000. How much did Karrie save during 2019?

Discuss five ways which the country can do to increase its savings rate.