1) What types of claims transformations do financial intermediaries undertake and explain the meaning and value of each to DBUs and SBUs?

1) What types of claims transformations do financial intermediaries undertake and explain the meaning and value of each to DBUs and SBUs?

2) What are the causes of external benefits and external costs?

3) Discuss the problem a market economy faces when external costs exist and then when external benefits exist.

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