Economics · Financial Institutions
Financial institutions are established to perform specialized roles in mobilizing savings, allocating capital, supporting development, and facilitating financial intermediation. Which of the following best distinguishes a financial institution from a non-financial business enterprise?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A financial institution primarily deals in financial assets, liabilities, and intermediation rather than production of ordinary goods✓
- 2A financial institution is always government-owned by law
- 3A financial institution cannot earn profit from its operations
- 4A financial institution functions only in capital markets and never in credit markets
Correct answer
A financial institution primarily deals in financial assets, liabilities, and intermediation rather than production of ordinary goods
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