Question

Three ways that savings can be transferred through the financial markets include all of the following EXCEPT Group of answer choices indirect transfer using the venture capital firm. direct transfer of funds. indirect transfer using the investment banker. indirect transfer using the financial intermediary.

Answer 1

Answer: indirect transfer using the venture capital firm.

Explanation:

The capital market works to transfer funds from those who have it (savers) to those who need it (borrowers).

There are three ways this happens:

1. Direct transfer - Savers transfer the money to those who need it directly without the need for any intermediary. For instance, your uncle loaning you money to start a car wash.
2. Indirectly through Investment bank - Investment banks take the money savers deposit with them and invest in people and businesses to create a return for the savers.
3. Indirectly through financial intermediary - Intermediaries like Mutual funds, Commercial banks etc, get money from savers and invest in opportunities.

Indirect transfer using Venture capital firm is not one of these ways as it falls under Indirectly through financial intermediary.