ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The main money market instruments are Treasury bills, commercial papers, certificate of deposits, and call money.

Detailed explanation-2: -Money markets include markets for such instruments as bank accounts, including term certificates of deposit; interbank loans (loans between banks); money market mutual funds; commercial paper; Treasury bills; and securities lending and repurchase agreements (repos).

Detailed explanation-3: -Equity shares are long-term instruments and hence, cannot be a money market instrument.

Detailed explanation-4: -Money market instruments include Bills of Exchange or Commercial Bills, Treasury Bills (T-Bills), Commercial Papers (CP), Certificate of Deposits (CD), Repurchase Agreements, Banker’s Acceptance and Call & Notice Money. Capital market instruments include bonds and stocks.

Detailed explanation-5: -(i) Treasury Bil (T-Bills) Treasury Bill refers to a promissory note used for short term borrowing by the government. (ii) Call Money. (iii) Commercial Paper (CPs) (iv) Certificate of Deposit (CDs) (v) Commercial Bill.