What is NOT true of financial intermediation?

Banks and financial markets are complementary intermediaries in the financial system Banks and financial markets are competing intermediaries in the financial system Both 1 and 2 None of the above

Banks and financial markets are complementary intermediaries in the financial system

The process by which allocation of funds is done is called financial intermediation. Banks and financial markets are competing intermediaries in the financial system, and give households a choice of where they want to place their savings.