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Which of the following is not true for money market? |
The money market is a market for short term funds The major participants in the market are the Reserve Bank of India (RBI), Commercial Banks, Nonbanking Finance Companies, State Governments, Large Corporate Houses and Mutual Funds. It has no physical location, but is an activity conducted over the telephone and through the internet. None of the above |
None of the above |
The correct answer is option 4: None of the above. All the given statement are related to money market. MONEY MARKET: The money market is a market for short term funds (Statement 1 is correct) which deals in monetary assets whose period of maturity is upto one year. These assets are close substitutes for money. It is a market where low risk, unsecured and short term debt instruments that are highly liquid are issued and actively traded everyday. It has no physical location, but is an activity conducted over the telephone and through the internet (Statement 3 is correct). It enables the raising of short-term funds for meeting the temporary shortages of cash and obligations and the temporary deployment of excess funds for earning returns. The major participants in the market are the Reserve Bank of India (RBI), Commercial Banks, Non Banking Finance Companies, State Governments, Large Corporate Houses and Mutual Funds (Statement 2 is correct). |
