Question: The capital allocation process involves the transfer of capital among different entities that include individuals, small businesses, banks, financial intermediaries, companies, mutual funds, and other
The capital allocation process involves the transfer of capital among different entities that include individuals, small businesses, banks, financial intermediaries, companies, mutual funds, and other market participants. In a developed market economy, capital flows freely between entities that want to supply capital to those who want it. This flow of capital can be dassified in three ways. In the table below, identify the nature of capital transfer given in the scenario with its appropriate classification: Indirect Transfers through Investment Banks Indirect Transfers through Financial Intermediaries Direct Transfers O o O Scenario A small startup firm has each of the partners contribute $50,000 in capital to help the company make payroll for the next three months. w2 Corp. needs capital to finance a new product line. It borrows money in the form of long-term bonds underwritten by an investment bank. California Public Employees' Retirement System (CalPERS) manages pension and health benefits of California public employees and retirees. CalPERS collects money from its participants and creates a pool of assets. It manages these assets by making investments across domestic and international markets Steve's grandfather loans him $30,000 to start a small coffee shop in the East Village in o Manhattan
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