Consider the following markets :
- 1.Government Bond Market
- 2.Call Money Market
- 3.Treasury Bill Market
- 4.Stock Market
How many of the above are included in capital markets?
Show answer
Answer: B. Capital markets deal in long-term funds. The government bond market and the stock market are capital markets. The call money market (overnight loans) and treasury bill market (up to 364 days) are money markets. So only two.
Watch for: Treasury bills and government bonds are both government debt; only bonds are long-term.
Why the other options are wrong
- A. Wrong because both government bonds and stocks belong to the capital market.
- C. Wrong because call money and treasury bills are money market items.
- D. Wrong because call money and treasury bills are short-term money market instruments.
Source to check: RBI website, Money Market and Government Securities Market FAQs; NCERT Class 12 Business Studies Part II, Ch 10 Financial Markets
Answer from the official UPSC key. Written and fact-checked by AI against the official key. Spotted a mistake? Report it.