12th Commerce Chapter 5 Assignment Answer key - Capital Market

•  Chapter- 5 Capital Market
• Part - A

I.One Mark Questions

1.When the NSEI was established …….

 a) 1990 

b) 1992 

c)1998 

d)1997 

2. Capital market do not provide 

a) Short term funds 

b) Debenture funds 

c) long term funds 

d) Equity funds 

3. Assertion A): Financial institutions that provide facilities for channeling savings of small investors 

into avenues of productive investments are called “Mutual funds”. 

Reason (R): “Small drops of water makes a Big Ocean”. 

a) A is correct but R is in correct 

b) A is in correct but R is correct

c) A and R Correct and R is the correct explanation of A

d) A and R Correct and R is not the correct explanation of A

4. Participants in the capital market includes

 a) Individuals

 b) Corporate 

 c) Financial institutions 

d) All of the above

5. Match the following 

1) securities market - a) companies

2) Price o securities - b) long term funds

3) partici nts - company securies

4) capital market d) dem nd and upp y

 a) 1 , 2- c 3 -a, -b

 b) 1 -c, 2- a, 3 -d, 4 -b

 c) 1 -c, 2 -d, 3 -b, 4 -a

 d) 1 -c, 2 -d, 3 -a, 4 -b

6. Primary market is a market where securities are traded in the 

 a) First time 

b) Second time 

 c) Several times 

d) Three times

7. Which one is incorrect pair

 a) Hard commodities market - Gold 

 b) Commodity market - Securities

 c) Soft commodities market - Cotton 

 d) Derivatives market - Financial instruments

8. The ………. was setup by a premier financial institution to allow the trading of securities across the  electronic counters throughout the country

 a) Factoring 

b) OTCEI 

 c) Mutual funds 

d) Venture fund institution

9. Capital Market deals _________

a) Securities

 b) Shares 

c) A and B 

d) None of these

10. Find the right one

 a) Mutual funds greatly change the savings of large investors

 b) Canara bank caring out Mutual Fund business

 c) The company cannot get an exemption through Mutual Fund

 d) Mutual funds provide less return to investors

Part – B

II.Very Short Answer. 

11. Give some companies carry out Mutual Fund business?

• Financial institutions that provide facilities for channeling savings of Small investors into avenues of productive investments are called ‘Mutual Funds’. A mutual fund company invests the funds pooled from shareholders and gives them the benefit of diversified investment portfolio and a reasonable return.

12. What is capital market?

• Capital market is a market where buyers and sellers engage in trade of financial securities like bonds, and stocks. The buying/selling is undertaken by participants such as individuals and institutions.

13. Who are the participants in a capital market

• There are many players in the capital market. The participants of the capital market include individuals, corporate sectors, Govt., banks and other financial institutions.

14. Write a note on OTCEI?

• The OTCEI was set up by a premier financial institution to allow the trading of securities across the electronic counters throughout the country.

15. How is price determined in a capital market?

• The price of the securities is determined based on the demand and supply prevailing in the capital market for securities.

Part – C

III. Short Answer

16. What are the various kinds of capital market? Explain

17. What is commodity mark t?

18. Explain any t o fun ions f c pit l m ket

19. Write a note on foreign exchange market?

20. Explain about Factoring and Venture Capital institutions

Part – D

IV.Write in detail.

21. Briefly explain the functions of Capital market (any five).

22. Discuss the characteristics of a Capital market?