What is the cycle of money? Who participates in the cycle of money? What is the objective of a financial transaction?

The cycle of money is:(Select the best response.)

A. the movement of funds from a lender to a borrower and back to the lender.

B. the movement of money from a borrower to a lender and back to the borrower.

C. the movement of funds from your savings account to your checking account and back to your savings account.

D. the movement of money from your checking account to the Internal Revenue Service and back to you in the form of a Social Security check.

The participants in the cycle of money are:(Select all that apply.)

A. the Federal Reserve which controls the money supply and provides money for business loans.

B. the financial institution that matches the lender with a borrower or bundles up a set of lenders for a single borrower.

C. the original lender, usually an individual (or household) through direct investment or through a financial institution.

D. a borrower such as a company that is using the funds for operating the business or expanding the business.

The objective of every financial transaction is: (Select the best response.)

A. to ensure that borrowers are able to make purchases.

B. to ensure that financial institutions remain strong.

C. to make all parties in the transaction better off.

D. to enrich the lenders.