GK
BANKING AWARENESS AND SEBI
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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This is the fund which is pushed into market through illegal methods
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This is the fund which is dumped into a country to get the advantage of a favourable interest rate
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This is the fund which is provided by a bank in US $ at very short notice and at a very high rate of interest and for a longer period of repayment
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None of the above
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Detailed explanation-1: -Hot money signifies currency that quickly and regularly moves between financial markets, that ensures investors lock in the highest available short-term interest rates. Hot money continuously shifts from countries with low-interest rates to those with higher rates.
Detailed explanation-2: -Types of hot money As mentioned above, capital in the following form could be considered hot money: Short-term foreign portfolio investments, including investments in equities, bonds and financial derivatives. Short-term foreign bank loans. Foreign bank loans with short term investment horizon.
Detailed explanation-3: -What is money? Money is a commodity accepted by general consent as a medium of economic exchange. It is the medium in which prices and values are expressed. It circulates from person to person and country to country, facilitating trade, and it is the principal measure of wealth.
Detailed explanation-4: -The 4 different types of money as classified by the economists are commercial money, fiduciary money, fiat money, commodity money. Money whose value comes from a commodity of which it is made is known as commodity money.