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Define intermediation.
The monetary system makes it possible for deficit and surplus economic units to come together exchanging funds for securities to their mutual benefit. When funds flow from excess economic units to a deficit economic unit to a financial institution the process is known as intermediation. The financial institution takes action as an intermediary between the two economic units.
Just as any other financial market, money market also involves transfer of funds in exchange for financial assets. Because of the nature of the money market, the
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