1.The directors of a company want to modernise its plant and machinery by making a public issue of shares. They wish to approach stock exchange, while the finance manager prefers to approach a consultant for the new public issue of shares. Advise the directors whether to approach stock exchange or a consultant for new public issue of shares and why? Also advise about the different methods which the company may adopt for the new public issue of shares.
2.You are a finance expert. One of your friends comes to you and tells you that the capital market and the money market are one and the same, whereas you differ with him. How would you convince him? Give any four reasons.
3. SEBI is the watch dog of the securities markets”. Do you agree? Give reasons.
4. “In today’s Commercial world, the stock exchange performs many vital functions.” Do you agree? Give any four reasons in support of your answer.
5. “Primary markets contribute to capital formation directly, secondary markets do so indirectly.” Explain
6. ‘Money market instruments are more liquid than capital market instruments’. Comment.
7. ‘Stock market imparts liquidity to investment’. Comment.
8.“Stock market quotations contribute to better allocation of capital and promoting the habits of savings and investments”. Explain.