Practicing Success

Target Exam

CUET

Subject

Business Studies

Chapter

Financial Markets

Question:

Match list I with list II

LIST 1
LIST II
A. Training of Intermediaries I. Functions of Financial Market
B. Providing liquidity to financial Assets II. Functions of Stock Exchange
C. Safety of Transaction III. Development function of SEBI
D.  Protect the interest of investor IV. Objective of SEBI

Choose the correct answer from the options given below:

Options:

(A)-(III), (B)-(I), (C)-(II), (D)-(IV)

(A)-(II), (B)-(III), (C)-(I), (D)-(IV)

(A)-(II), (B)-(IV), (C)-(I), (D)-(III)

(A)-(II), (B)-(I), (C)-(IV), (D)-(III)

Correct Answer:

(A)-(III), (B)-(I), (C)-(II), (D)-(IV)

Explanation:

* The overall objective of SEBI is to protect the interests of investors and to promote the development of, and regulate the securities market. This may be elaborated as follows: 1.To regulate stock exchanges and the securities industry to promote their orderly functioning. 2.To protect the rights and interests of investors, particularly individual investors and to guide and educate them. 3.To prevent trading malpractices and achieve a balance between self regulation by the securities industry and its statutory regulation. 4.To regulate and develop a code of conduct and fair practices by intermediaries like brokers, merchant bankers etc., with a view to making them competitive and professional.

* Development Functions 1.Training of intermediaries of the securities market. 2.Conducting research and publishing information useful to all market participants. 3.Undertaking measures to develop the capital markets by adapting a flexible approach.

*The basic function of a stock exchange is the creation of a continuous market where securities are bought and sold. It gives investors the chance to disinvest and reinvest. This provides both liquidity and easy marketability to already existing securities in the market.

* Financial Market is a market for creation and exchange of financial assets. It helps in mobilisation and channelising the savings into most productive uses. Financial markets also helps in price discovery and provide liquidity to financial assets.