Which financial institution is not involved in the indirect method of financial

Question

Which financial institution is not involved in the indirect method of financial intermediation? Banks Investment bankers final Pension funds Which of the following is not considered to be an institutional investor? governments pension funds insurance companies mutual funds r Typically debt financing can be cither short- or long-term, whereas equity financing is almost always long-term, the word "term" meaning: the time between a security's issue and its retirement the duration specified on all debt and equity securities the amount of time necessary to realize the required return on the investment all of the above The term of an investment can be described as either: long or short, long-term meaning any duration longer than five years intermediate or short, intermediate being any duration longer than one year long, intermediate, or short, intermediate being any duration longer than one year but shorter than five years none of the above The principal differences between capital markets and money markets are that: a. money and capital markets deal in the same securities, the only difference is term both markets deal in short-term debt securities; however, capital markets deal also in equity securities which have an indefinite term money markets deal only in short-term government debt capital markets deal in long-term debt and equity securities, while money markets deal only in short-term debt

Explanation / Answer

As there are numerous questions, and in the absence of any specific requests, I am answering the first 2 questions here.

1. One of the role of the financial markets is the transmission mechanism between savers and borrowers. Savers are those who spend less than their incomes, while borrowers are those who spend more than their incomes. The transmission may be direct, such as through savers buying securities from borrowers, or indirect, such as savers lending to banks in the form of deposits and banks making loans to borrowers. The indirect method is known as financial intermediation. The bank is one type of financial intermediary. Other types of financial intermediaries include mutual funds, insurance companies, savings and loan associations, and credit unions. Brokers, dealers and investment bankers play important roles in direct financing.

Hence, the answer is (b) Investment Bankers

2. Institutional investor is a term for entities which pool money to purchase securities, real property, and other investment assets or originate loans. Institutional investors include banks, insurance companies, pensions, hedge funds, investment advisors, endowments, and mutual funds. Governments are not institutional investors.

Hence, the answer is (a) Governments

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