Chapter Exam

Chapter 6: Money Market — Online MCQ Test

Q: Which of the following is a money market instrument?

Answer: C. Treasury Bills — Treasury Bills are short-term debt instruments issued by the government and are part of the money market.

Q: The money market mainly provides funds for a period of:

Answer: A. Less than one year — Money market instruments are used for very short-term financial requirements, generally less than one year.

COMMERCE · CLASS 12th · Tamil Nadu State Board

Practice Chapter 6: Money Market with a free chapter-wise online MCQ test for Tamil Nadu State Board CLASS 12th COMMERCE. This chapter covers: This chapter explores short-term financial systems and debt instruments. Students analyze money market participants key differences from capital markets and core instruments like T.... AI-generated questions from basic to board-exam level, with instant results and explanations.

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Chapter 6: Money Market — Important Questions & Answers (FAQ)

Frequently asked questions from Tamil Nadu State Board CLASS 12th COMMERCE — Chapter 6: Money Market, with answers and explanations. These are sample questions; the exam has its own separate question set.

What is the main purpose of the money market?

A. To provide long-term capital to companies
B. To deal with short-term funds and financial instruments ✓
C. To trade only shares and debentures
D. To finance fixed assets of businesses

Answer: B. To deal with short-term funds and financial instruments
The money market deals with short-term borrowing and lending, usually for funds needed for up to one year.

Which of the following is a money market instrument?

A. Equity shares
B. Debentures
C. Treasury Bills ✓
D. Preference shares

Answer: C. Treasury Bills
Treasury Bills are short-term debt instruments issued by the government and are part of the money market.

The money market mainly provides funds for a period of:

A. Less than one year ✓
B. More than ten years
C. Five to fifteen years
D. Only for equity investment

Answer: A. Less than one year
Money market instruments are used for very short-term financial requirements, generally less than one year.

Which of the following best distinguishes the money market from the capital market?

A. Money market deals with long-term securities, capital market with short-term funds
B. Money market deals with short-term funds, capital market with long-term funds ✓
C. Money market deals only with shares, capital market only with bonds
D. Money market is regulated, capital market is not regulated

Answer: B. Money market deals with short-term funds, capital market with long-term funds
The key difference is the maturity period: money market instruments are short-term, while capital market instruments are long-term.

Which one of the following is NOT correctly matched?