In the capital markets, the instruments which are traded having maturity of more than one year is classified as ____________?
Correct answer: B. bonds and mortgages
- A. contraction mortgages
- B. bonds and mortgages
- C. expansion bonds
- D. expansion mortgages
Explanation
Capital-market instruments generally have maturities exceeding one year, and the listed instruments fitting this description are bonds and mortgages. Short-term instruments instead belong to the money market.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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