The financial instruments are traded in money markets and then traded in __________?
Correct answer: B. capital markets
- A. money markets
- B. capital markets
- C. debt markets
- D. economic markets
Explanation
Money markets deal in short-term instruments, whereas capital markets deal in longer-term debt and equity securities. The question contrasts these two main parts of the financial market.
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About Business Finance
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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