Financial assets have two principal economic functions. Which of the below is ONE of these?
A. A principal economic function is to transfer funds from those who have surplus funds to borrow to those who need funds to invest in intangible assets.
B. A principal economic function is to transfer funds in such a way as to redistribute the avoidable risk associated with the cash flow generated by intangible assets among those seeking and those providing the funds.
C. A principal economic function is to transfer funds in such a way as to redistribute the unavoidable risk associated with the cash flow generated by tangible assets among those seeking and those providing the funds.
D. A principal economic function is to transfer funds from those who have surplus funds to invest to those who need funds to invest in intangible assets.
Answer:C
Financial assets have two principal economic functions. Which of the below is ONE of these?
A. A principal economic function is to transfer funds from those who have surplus funds to borrow to those who need funds to invest in intangible assets. B. A principal economic function is to transfer funds in such a way as to redistribute the avoidable risk associated with the cash flow generated by intangible assets among those seeking and those providing the funds. C. A principal economic function is to transfer funds in such a way as to redistribute the unavoidable risk associated with the cash flow generated by tangible assets among those seeking and those providing the funds. D. A principal economic function is to transfer funds from those who have surplus funds to invest to those who need funds to invest in intangible assets.