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प्रश्न
Justify the following statement.
Money market makes available short term finance through different instruments.
उत्तर
- In the money market, lending and borrowing of funds take place for a short period of time, which may vary from one day to a year.
- Financial instruments in this market can be easily converted into cash without loss of time and value.
- In other words, money market deals with only those financial instruments which are immediate substitute for money.
- Some of the instruments used in the money market are call and notice money, treasury bills, trade/ commercial bills, commercial papers, certificates of deposits, government securities, repurchase agreements, Money Market Mutual Funds, etc.
- All these instruments have a maturity period of less than a year
- Hence, the money market makes available short-term finance through different instruments.
APPEARS IN
संबंधित प्रश्न
Central government is a borrower in the money market through the issue of ______.
Match the pair.
| Group ‘A’ | Group ‘B’ |
| a) Financial market | 1) Long term fund |
| b) Money market | 2) New issue market |
| c) Primary market | 3) Trading of commodities |
| d) Commercial paper | 4) Short term fund |
| 5) Trading of financial securities | |
| 6) Share market | |
| 7) Unsecured promissory note | |
| 8) Secured promissory note |
Write a word or a term or a phrase which can substitute the following statement.
A money market instrument used by banks when one bank faces a temporary shortage of cash.
Write a word or a term or a phrase which can substitute the following statement.
A bill which is issued by Reserve Bank of India on behalf of the Government of India.
Write a word or a term or a phrase that can substitute the following statement.
A market that exclusively deals with the new issue of securities
State whether the following statement is true or false
Money market is the market for the long term funds
State whether the following statement is true or false
Capital market is the market for the long term funds.
State whether the following statement is true or false
Secondary market is commonly known as stock market.
Complete the sentence.
Funds borrowed and lent in money market are for ___________ term.
Complete the sentence.
In capital market the instruments traded have maturity period of more than ______ year.
Answer in one sentence.
What is call money market?
Explain the following term/concept.
Repurchase agreement
Answer in brief.
Explain any 4 types of money market instruments.
Justify the following statement.
Financial markets acts as link between investor and borrower.
Justify the following statement.
There are many participants in money market.
Answer the following question
State the instruments in money market.
Study the following case/situation and express your opinion.
| Joy ltd. company is a newly incorporated company. It wants to raise capital for the first time by issuing equity shares. |
- Should it go to the primary market or secondary market to issue its shares?
- Should it offer its shares through public offers or rights issues?
- What will be the issue of Equity shares by Joy Ltd. co. called, IPO or FPO?
