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Explain the Following Money Market Instruments: Treasury Bill - Business Studies

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प्रश्न

Explain the following Money Market Instruments: 

Treasury bill

उत्तर

Treasury bills (T-Bills): A treasury bill is a short-term borrowing instrument of the Government of India. It is a promissory note having a maturity period of less than one year. T-bills are issued by the Reserve Bank of India on behalf of the Central Government.

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Types of Financial Markets
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2013-2014 (March) Foreign Set 2

संबंधित प्रश्न

Differentiate between `capital-market' and 'money-market' on the following basis:

Investment outlay


Differentiate between `capital-market' and 'money-market' on the following basis:

Duration


Differentiate between `capital-market' and 'money-market' on the following basis:

Liquidity


Differentiate between 'capital-market' and 'money-market' on the basis of:

Safety;


Differentiate between 'capital-market' and 'money-market' on the basis of:

Expected return;


Differentiate between 'capital-market' and 'money-market' on the basis of:

Meaning;


Explain the following Money Market Instruments:

Commercial paper


State any four functions of 'Secondary - Market'.


Primary market is also called as ______.


Spot Market is a market where the delivery of the financial instrument and payment of cash occurs


What is Spot Market?


What is Debt Market?


Differentiate Spot Market from Future Market.


Enumerate the different kinds of Financial Markets.


Vedansh Limited has a share capital of ₹10,00,000 divided into shares of ₹100 each.For expansion purposes, the company requires additional funds of ₹ 5,00,000. The management is considering the following alternatives for raising funds :

Alternative 1: Issue of 5000 Equity shares of ₹100 each

Alternative 2: Issue of 10% Debentures of Rs. 5,00,000 

The company’s present Earnings Before Interest and Tax ( EBIT) is ₹4,00,000 p.a. Assuming that the Rate of Return of Investment remains the same after expansion, which alternative should be used by the company in order to maximise the returns to the equity shareholders. The Tax rate is 50%. Show the working.


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