Identify the function performed by Financial Market from the following statement: 'Holders of assets can readily sell their financial assets through the mechanism of the financial market.' Option 1: Reduce the cost of transactions Option 2: Provide liquidity to financial assets Option 3: Facilitate price discovery Option 4: Mobilisation of savings and channelising them into the most productive uses

Answer: Provide liquidity to financial assets. Solution: Reduce the cost of transactions → Lowers expenses for trading. Provide liquidity to financial assets → Enables quick asset sales. Facilitate price discovery → Helps determine asset values. Mobilisation of savings → Channels funds to productive uses. Correct answer: 2 - Financial markets allow asset holders to sell quickly, ensuring liquidity.

Business Studies

Financial Markets

Easy

Identify the function performed by Financial Market from the following statement: 'Holders of assets can readily sell their financial assets through the mechanism of the financial market.'

Reduce the cost of transactions

Provide liquidity to financial assets

Facilitate price discovery

Mobilisation of savings and channelising them into the most productive uses

✅ Correct Option: 2

Reduce the cost of transactions → Lowers expenses for trading.
Provide liquidity to financial assets → Enables quick asset sales.
Facilitate price discovery → Helps determine asset values.
Mobilisation of savings → Channels funds to productive uses.

Correct answer: 2 - Financial markets allow asset holders to sell quickly, ensuring liquidity.

2026: 13 May Shift 1

The following is not an advantage of the Electronic Trading System:

2024

Identify the correct sequence of trading & settlement procedure:

2022: 16 July Shift 2

Which of the following statement is/are correct regarding function of Stock Exchange?

A. Providing liquidity and market ability to existing securities.

B. Training of intermediaries.

C. Undertaking steps of investor protection.

D. Promotion of fair practices and code of conduct in securities market.

E. Regulation of takeover bids by companies.

Choose the correct answer from the options given below:

2022: 17 Aug Shift 1

Anek Ltd. Issued a public offer to raise Rs. 70 lakh equity from primary market. In the process of floating the issue, it incurred certain expenses like brokerage, commission, printing of application, advertising etc. Identify the money market instrument that can be used for financing this cost.

2022: 15 July Shift 2

Name the market for financial securities which is also known as 'New Issue Market'

2026: 21 May Shift 2

The following is not a method of floating new issues in the primary market:

Identify the function performed by Financial Market from the following statement: 'Holders of assets can readily sell their financial assets through the mechanism of the financial market.'

Solution

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