BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Not all commercial banks deal for their customers in the secondary market
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Money markets are used extensively by businesses both to warehouse, surplus funds and to raise short-term funds
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The single most influential participant in the US money market is the US Treasury Department
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Both A and B
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Detailed explanation-1: -The money market is a market for short term funds which deals in monetary assets whose period of maturity is upto one year. It is a market where low risk, unsecured and short term debt instruments that are highly liquid are issued and actively traded everyday. It has no physical locations.
Detailed explanation-2: -Which of the following is correct about money market instruments? ☐ They are very short-term debt instruments that meet the needs of investors who want to invest in liquid assets. Yes. Money market instruments are short-term debt instruments.
Detailed explanation-3: -The basic function of money market is to provide efficient liquidity position for commercial banks, financial institution, Mutual funds, insurance companies, corporate etc. D. Maturity in this market is above one year.
Detailed explanation-4: -Treasury Bills, Certificate of Deposit as well as Commercial papers are money market instruments.