[Solved] Consider the following markets: Government Bond Market Cal] Money Market Treasury Bill Market Stock Market How many of the above are included in capital markets? Skip to main content

[Solved] Consider the following markets: Government Bond Market Cal] Money Market Treasury Bill Market Stock Market How many of the above are included in capital markets?

Question

Q75. Consider the following markets:

  1. Government Bond Market
  2. Cal] Money Market
  3. Treasury Bill Market
  4. Stock Market

How many of the above are included in capital markets?

  1. Only one
  2. Only two
  3. Only three
  4. AIl four

Answer: 2

Detailed Explanation

There are two types of Markets:

Long Term (called Capital – Market for long-term funds (more than 1 year))

Short Term (called Money – Market for short-term funds (less than 1 year))

Now, let’s look at the options:

Government Bond MarketCapital Market

• Long-term instruments (dated securities) → capital market

Call Money MarketNOT Capital Market

• Very short-term (overnight) lending between banks → money market

Treasury Bill MarketNOT Capital Market

• Short-term (less than 1 year) government borrowing → money market

Stock MarketCapital Market

• Equity shares, long-term securities → capital market

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