Many market participants interact with financial institutions to organize the exchange of funds between surplus units and deficit units. Such institutions include commercial banks, credit unions, insurance companies, mutual funds, pension funds, savings institutions, and securities firms. These institutions play key roles in facilitating the flow of funds between surplus units and deficit units.

Which of the following are key roles of financial institutions? Check all that apply.

a) They prevent investors from losing money in the event of an economic downturn.

b) They repackage depositor funds to fit the size and maturity length needs of deficit units.

c) They serve as activist shareholders which allows them to monitor publicly traded firms.

d) They take on riskier loans, knowing they could default.