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Igoryamba
3 years ago
10

Direct finance is a transaction between two parties where one party lends directly to the other​ party, whereas indirect finance

involves three​ parties: the​ borrower, the​ lender, and a third partylong dashsuch as a bank. Which involves financial​ intermediaries, and which involves financial​ markets?
Business
1 answer:
mamaluj [8]3 years ago
8 0

Direct financing involves the financial market and indirect financing involves intermediaries. In the financial market, companies put their shares for sale and investors buy them. This is a direct financing mechanism for companies, which raise funds by sharing their own capital in traded shares.

On the contrary, if a company seeks bank financing, there will necessarily be intermediation by third parties, such as banks. In the middle market, economic agents deposit their money with the bank, and the bank uses it to lend to companies. This is intermediating a financing. Both types of financing are widely used, all will depend on the structure and purpose of each company in the search for financing.

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7 0
2 years ago
Clem Oatley could grow wheat and barley. He could grow 75 bushels of wheat or 125 bushels of barley using the same resources on
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Answer:

Clem should specialise in wheat production because he has higher profits there

Explanation:

Clem needs to make a decision on the product that will maximise his profits and not just the number of units of products he can manufacture.

If he produces only wheat he will have profit of 75 bushels * $2 = $150

If he produces only barley his profit will be 125 bushels * $0.80 = $100

This shows that wheat is more profitable for Clem. Even though he can produce more units of barley.

6 0
3 years ago
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Answer: $40,000

Explanation:

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5 0
3 years ago
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Vedmedyk [2.9K]

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7 0
3 years ago
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