Advertisements
Advertisements
Question
Answer each of these questions in about fifteen words:
What is the need of secondary market?
Advertisements
Solution
The secondary capital market, which is also known as old securities market or stock exchange deals with buying and selling of old securities i.e. the market securities issued earlier are sold by existing investors in this market, thus paving way for the entrepreneurs that if they offer high returns to market, investors will remain inclined to invest therein. The secondary market enhances the marketability of securities and thereby provides liquidity to investments.
APPEARS IN
RELATED QUESTIONS
Answer the following question:
An investor wanted to incest RS. 20,000 in Treasury Bills for a period of 91 days. When he approached the Reserve Bank of India for this purpose he came to know that it was not possible.
Identify the reason why the investor could not invest in the Treasury Bill.
Differentiate between ‘primary market’ and ‘secondary market’ on any five basis.
Explain the recent Capital Market reforms in India.
State how sources can broadly be classified into two major categories.
Answer each of these questions in about fifteen words:
Name the sources of demand for capital comes from.
Answer each of these questions in about fifteen words:
Name the two players in the capital market.
Answer each of these questions in about fifteen words
identify the method of raising additional finance from existing shareholders by offering securities to them on pro-rata basis.
Answer this question in about fifteen words:
What is Right Issue?
Answer each of these questions in about fifteen words:
What is a secondary market?
Assertion and Reasoning:
- Assertion (A): Regional stock exchanges have witnessed a sharp decline in the volume of trade.
- Reasoning (R): Investors prefer to trade in securities listed in premier stock exchanges like BSE, NSE, etc.
Primary market is also known as new issue market.
Justify the following statement.
Capital market is useful for the corporate sector.
Policy that aims at managing the quantity of money in order to meet the requirements of different sectors of the economy and to increase the pace of economic growth –
Assertion (A): Stock exchange is an important constituent of the money market.
Reasoning (R): Stock exchange is an organization in which stocks, bonds, commodities etc. are traded.
Identify & explain the concept from the given illustration.
Kerala-based company K Jewellers intends to raise ₹1000 crore by fresh issuance of shares.
Bank Rate means.
‘While there are benefits of going public as a source of finance for a company, it also means additional obligations'.
Analyse and justify the statement.
Identify and explain the following concept:
Raju’s father invests his money in a market for long term funds both equity and debt raised within and outside the country.
Which of the following statements is incorrect?
Identify the place where transaction happens in shares or debentures subsequent to its primary offering.
In its vital role as a financial intermediary, capital markets satisfies the tastes of the savers and the need of the investors. Evaluate the given statement.
Complete the correlation:
Money market : Short term funds :: _____ : Long term funds.
Complete the correlation:
Money market : Short term funds :: ______ Long term funds.
Complete the correlation.
Money market : Short term funds :: ______ : Long term funds
