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Financial market

Financial market

Assessment

Presentation

Business

12th Grade

Practice Problem

Hard

Created by

Raj Narayan Yadav

FREE Resource

29 Slides • 25 Questions

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Multiple Choice

Which of the following best describes the money market?

1

A market for long-term funds

2

A market for short-term funds

3

A physical place where money is traded

4

A market for consumer goods

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Multiple Select

Which of the following are examples of money market instruments?

1

Treasury Bills

2

Commercial Paper

3

Certificate of Deposit

4

Equity Shares

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Fill in the Blank

Treasury Bills are issued by RBI on behalf of the ___ Government.

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Open Ended

Explain the concept of 'discount' in the context of Treasury Bills and why they are issued at a price lower than their face value.

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Multiple Choice

Which of the following statements about Commercial Paper is correct?

1

It is an unsecured promissory note issued to the public with a fixed maturity period.

2

It is a secured loan issued by the government.

3

It is only available for periods longer than one year.

4

It is issued by the Reserve Bank of India.

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Multiple Choice

What is the primary purpose of issuing Commercial Paper?

1

To meet flotation cost, brokerage, advertising, and printing share applications

2

To finance long-term infrastructure projects

3

To provide loans to individuals

4

To pay employee salaries

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Multiple Choice

Which of the following is an important source of working capital and bridge financing for raising long-term funds from the capital market?

1

Commercial Paper

2

Equity Shares

3

Debentures

4

Preference Shares

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Multiple Select

Which of the following statements about Call Money are correct?

1

It deals with day-to-day surplus funds of banks and financial institutions.

2

The duration of call money is from one day to 15 days.

3

Interest paid on call money is called call rate.

4

It is issued by the government to the public.

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Fill in the Blank

The maturity period of a Certificate of Deposit (CD) ranges from ___ months to ___ months.

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Multiple Choice

Which instrument is a short period, negotiable, and self-liquidating instrument used to finance credit sales?

1

Commercial Bill

2

Certificate of Deposit

3

Call Money

4

Commercial Paper

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Open Ended

Explain the main features and uses of Commercial Bills (Trade Bills) in the money market.

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Multiple Choice

What happens to a bill of exchange when it is accepted by the buyer (drawee)?

1

It becomes a trade bill and a marketable instrument

2

It is destroyed

3

It is returned to the seller

4

It is sent to the government

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Open Ended

Explain the process by which a commercial bill can provide funds to a seller before its maturity.

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Multiple Select

Which of the following are considered money market instruments?

1

Treasury Bills

2

Commercial Bill

3

Commercial Paper

4

Equity Shares

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Open Ended

How do capital markets benefit both borrowers and lenders?

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Fill in the Blank

The capital market enables borrowers to raise ___ for their purpose.

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Fill in the Blank

A security means a certificate of title evidencing investment made in the ___ or debt of any entity.

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Multiple Choice

Which of the following is NOT an instrument of the capital market?

1

Equity shares

2

Preference shares

3

Debentures

4

Savings account

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Fill in the Blank

The value of one unit in the capital market can be as low as Rs. ___

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Multiple Select

Which of the following are features of the capital market?

1

Liquidity

2

High risk

3

Short term instruments

4

Expected return

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Multiple Choice

Who controls the capital market in India?

1

RBI

2

SEBI

3

Ministry of Finance

4

NABARD

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Open Ended

Explain the difference between the money market and the capital market based on their duration and participants.

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Open Ended

Describe the role of a stock exchange in the capital market and explain why it is important for investors.

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Multiple Choice

What is the primary purpose of the money market?

1

To provide long-term loans

2

To facilitate the trading of stocks

3

To provide short-term funds

4

To issue government bonds

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Open Ended

Summarize what you have learned about the money market and its main characteristics.

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