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Which of the following would best describe the role of a merchant bank? (A) To monitor the activities of publicly-listed companies (B) To act as banker and financial agent to the federal government (C) To provide borrowing and lending services, primarily to the business sector (D) To provide loans to the corporate sector through receipts of insurance premiums - HSC - SSCE Business Studies - Question 6 - 2003 - Paper 1
Question 6
Which of the following would best describe the role of a merchant bank? (A) To monitor the activities of publicly-listed companies (B) To act as banker and financial... show full transcript
Worked Solution & Example Answer:Which of the following would best describe the role of a merchant bank? (A) To monitor the activities of publicly-listed companies (B) To act as banker and financial agent to the federal government (C) To provide borrowing and lending services, primarily to the business sector (D) To provide loans to the corporate sector through receipts of insurance premiums - HSC - SSCE Business Studies - Question 6 - 2003 - Paper 1
Step 1
To provide borrowing and lending services, primarily to the business sector
Answer
Merchant banks primarily focus on providing services to corporations, particularly in the realm of borrowing and lending. They facilitate access to capital for businesses through various financial products and services such as loans, equity investments, and other financing strategies. Their role is crucial in supporting the financial needs of large companies and helping them manage their financial operations effectively.