What is the disadvantage of using expenditure-based fiscal ...

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What is the disadvantage of using expenditure-based fiscal policy?
 
  What will be an ideal response?

Question 2

What are the three functions that banks perform as financial intermediaries?
 
  What will be an ideal response?

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Answer to Question 1

Rising government expenditures leads to more government borrowing, and such borrowing can soak up resources that would otherwise have been used by households and firms. Some economists believe that rising government expenditure displaces private economic activity like consumption and investment. This implies that employment increases by less than it would have otherwise increased.

Answer to Question 2

The three functions that banks perform as financial intermediaries are:
a. Banks identify good investment options.
b. Banks transform short-term liabilities like deposits, into long-term investments.
c. Banks transfer risk from depositors to the bank's stockholders and, in some cases, to the government.