Individuals May Find It More Advantageous to Purchase Claims from a Financial

Multiple Choice

Individuals may find it more advantageous to purchase claims from a financial intermediary rather than directly purchasing claims in capital markets because:
I. Intermediaries are better diversified than most individuals.
II. Intermediaries can exploit economies of scale in investing that individual investors cannot.
III. Intermediated investments usually offer higher rates of return than direct capital market claims.

A) I only
B) I and II only
C) II and III only
D) I, II, and III