Advertisements
Advertisements
Question
Primary market is also known as new issue market.
Options
True
False
Advertisements
Solution
This statement is True.
Explanation:
In Primary market, companies sell their shares, Debentures, etc. for the first time to raise fresh capital. It exclusively deals with the issue of new securities, i.e. securities that are issued to investors for the very first time. Hence this market is also known as New Issues Market.
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.
Explain the recent Capital Market reforms in India.
Answer each of these questions in about fifteen words:
Which sources provide the supply for long-term funds?
Answer each of these questions in about fifteen words:
Name the sources of demand for capital comes from.
Answer this question in about fifteen words:
What is Right Issue?
Answer each of these questions in about two hundred and fifty words:
“An entrepreneur can raise the required capital in the primary market.” Explain the various methods of raising the funds in the primary market by an entrepreneur.
Justify the following statement.
Capital market is useful for the corporate sector.
Complete the correlation.
Primary market: New issues launched to raise capital:: ______: Old issues through stock market.
Identify & explain the concept from the given illustration.
Kerala-based company K Jewellers intends to raise ₹1000 crore by fresh issuance of shares.
To be listed on OTCEI, the minimum capital requirement for a company is
Read the following text and answer the following question on the basis of the same:
ISQM SOLAR Limited is searching for options to raise Rs. 20,000 crores from the primary market for diversification and modernisation of existing projects. It hired the services of a renowned financial consultancy firm, DHAN LAXMI Pvr LTD. to suggest options for the same. DHAN LAXMI PVI LTD. suggested a list of options to the Board of Directors of the company. It was decided that for the immediate requirement of Rs. 1,500 crores, the company will give a privilege to existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company. Rs. 4,500 crores would be raised by allotment of securities to a consortium of financial institutions, instead of inviting subscription from the public by making a direct appeal to investors to raise capital. It was further decided to raise capital to the tune of Rs. 6,000 crores through an issuing house. All these options were accepted by the Board of Directors. The Board further decided to raise Rs. 8,000 crores through the online system of the stock exchange by entering into an agreement with the exchange.
Identify the method of floatation of new issues in the primary market, not taken up by ISQM SOLAR LTD.:
Read the following text and answer the following question on the basis of the same:
ISQM SOLAR Limited is searching for options to raise Rs. 20,000 crores from the primary market for diversification and modernisation of existing projects. It hired the services of a renowned financial consultancy firm, DHAN LAXMI Pvr LTD. to suggest options for the same. DHAN LAXMI PVI LTD. suggested a list of options to the Board of Directors of the company. It was decided that for the immediate requirement of Rs. 1,500 crores, the company will give a privilege to existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company. Rs. 4,500 crores would be raised by allotment of securities to a consortium of financial institutions, instead of inviting subscription from the public by making a direct appeal to investors to raise capital. It was further decided to raise capital to the tune of Rs. 6,000 crores through an issuing house. All these options were accepted by the Board of Directors. The Board further decided to raise Rs. 8,000 crores through the online system of the stock exchange by entering into an agreement with the exchange.
Identify the reason which has made the firm raise funds from the institutional investors :
‘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.
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
Complete the correlation.
Money market : Short term funds :: ______ : Long term funds
Complete the correlation:
Money market : Short term funds :: ______ : Long term funds
