Continued from https://www.bartleby.com/questions-and-answers/allen-would-like-to-open-a-business-to-produce-a-software-that-he-thinks-would-be-well-received-by-t/449f08a9-ad...


Continued from https://www.bartleby.com/questions-and-answers/allen-would-like-to-open-a-business-to-produce-a-software-that-he-thinks-would-be-well-received-by-t/449f08a9-ad79-4242-b702-83e9307100f8,
Now assume that Allen needs to borrow £300 to produce his software, which will generate £500 in two years. There are N savers in the economy, each endowed with £2 and each facing a 25% chance that there will be an emergency and they will need their £2 back. What is the minimum value of N such that a financial intermediary can solve the problem of getting money from savers to borrowers?



Jun 05, 2022
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