Distinguish between direct finance and indirect finance. Which of thes

Distinguish between direct finance and indirect finance. Which of these is the most important source of funds for corporations in the United States?

What will be an ideal response?

ANSWER

With direct finance, funds flow directly from the lender/saver to the borrower. With indirect finance, funds flow from the lender/saver to a financial intermediary who then channels the funds to the borrower/investor. Financial intermediaries (indirect finance) are the major source of funds for corporations in the U.S.