[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?

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

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 Market – Capital Market

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

Call Money Market – NOT Capital Market

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

Treasury Bill Market – NOT Capital Market

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

Stock Market – Capital Market

• Equity shares, long-term securities → capital market