For each of the following cases, explain what
service the financial intermediary is providing
to savers or borrowers: risk sharing, liquidity, or
information.
a. A mutual fund allows savers to purchase
shares in a large number of firms.
b. A bank takes in small deposits and makes
mortgage loans.
c. A life insurance company offers consumers
life insurance, auto insurance, and fire
insurance.
d. A firm deducts money from its workers’
paychecks
and contributes the money to a
pension fund.
e. An investment bank underwrites a new issue
of stock.