Worksheet: Financial Market | Business Studies (BST) Class 12 - Commerce PDF Download

Multiple Choice Questions (MCQs)

Q1: What is the primary function of a financial market?
A) To provide loans to individuals
B) To facilitate the transfer of funds from savers to borrowers
C) To regulate interest rates
D) To control inflation

Q2: Which of the following is NOT a type of money market instrument?
A) Treasury Bill
B) Commercial Paper
C) Equity Shares
D) Certificate of Deposit

Q3: What does the capital market primarily deal with?
A) Short-term funds
B) Long-term funds
C) Daily transactions
D) Currency exchange rates

Q4: Which institution is responsible for regulating the securities market in India?
A) Reserve Bank of India
B) Securities and Exchange Board of India
C) Bombay Stock Exchange
D) National Stock Exchange

Q5: What is the main purpose of a stock exchange?
A) To provide loans to companies
B) To allow companies to raise funds
C) To help investors buy and sell securities
D) Both B and C

Fill in the Blanks

Q1: The process of converting a share certificate from physical form to electronic form is called __________.
Q2: The __________ market deals with short-term funds and monetary assets with a maturity period of up to one year.
Q3: The __________ is where securities are sold for the first time to raise long-term capital.
Q4: SEBI was established in __________ to protect the interests of investors.
Q5: A __________ is a short-term unsecured promissory note issued by creditworthy companies.

True or False

Q1: The capital market only deals with short-term financial instruments.
Q2: The National Stock Exchange was established in 1992.
Q3: Liquidity in a financial market allows investors to easily buy and sell assets.
Q4: Commercial bills are used to finance long-term investments.
Q5: SEBI's primary role includes protecting the rights and interests of investors.

Short Answer Questions

Q1: What is a financial market?
Q2: What are the two main types of financial markets?
Q3: What is a stock exchange?
Q4: What does SEBI do?
Q5: What is dematerialisation?

Long Answer Questions

Q1: What are the primary functions of financial markets, and how do they contribute to economic growth?
Q2: Compare and contrast the money market and the capital market in terms of instruments, participants, and purposes.
Q3: Explain the role of stock exchanges in the financial market and their importance to investors and companies.
Q4: Discuss the significance of SEBI in regulating the securities market and protecting investors.
Q5: Describe the process of trading in a stock exchange, including the role of brokers and the importance of technology.

You can access the solutions to this worksheet here.