For which of the following sources of financial resources may financial intermediation NOT be required?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. Family funds.
- When the family has direct access to the required capital or resources, such as investments, personal savings, or revenue from family-owned businesses, financial intermediation may not be necessary for family funds.
- In these situations, the family can handle its finances on its own without the assistance of banks, brokers, or other middlemen to help with investments or transactions.
- The family can rely on personal control and decision-making instead of the fees and complications that come with financial intermediaries thanks to this direct management of funds.