BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

FINANCIAL ACCOUNTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
____ is the market for trading short term ____
A
capital market
B
money market
C
securities
D
bonds
Explanation: 

Detailed explanation-1: -Money market refers to the market for trading of short term securities and funds. Securities traded in the money market have a very short maturity period ranging from one day to one year.

Detailed explanation-2: -For the most part, money markets provide those with funds-banks, money managers, and retail investors-a means for safe, liquid, short-term investments, and they offer borrowers-banks, broker-dealers, hedge funds, and nonfinancial corporations-access to low-cost funds.

Detailed explanation-3: -Trading securities are considered current assets and are found on the asset side of a company’s balance sheet. These assets are short term, as the company intends to buy and sell them quickly to turn a profit.

Detailed explanation-4: -The money market is part of the fixed-income market that specializes in short-term debt securities that mature in less than one year. Most money market investments often mature in three months or less. Because of their quick maturity dates, these are considered cash investments.

Detailed explanation-5: -Capital market is a place where buyers and sellers indulge in trade (buying/selling) of financial securities like bonds, stocks, etc. The trading is undertaken by participants such as individuals and institutions. Capital market trades mostly in long-term securities.

There is 1 question to complete.