Money Market: Definition And Key Functions - SS2 Accounting Past Questions and Answers - page 1
What is the primary purpose of the money market?
To provide long-term financing to businesses and governments
To facilitate short-term borrowing and lending
To provide a marketplace for stocks and bonds
To regulate interest rates
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What financial instruments are commonly traded in the money market?
Stocks and bonds
Mutual funds and ETFs
Treasury bills and commercial paper
Options and futures contracts
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How long is the typical borrowing period in the money market?
Up to 3 months
Up to 6 months
Up to 1 year
Up to 5 years
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What role do central banks play in the money market?
They provide short-term financing to businesses and governments
They regulate the money supply and interest rates
They facilitate the buying and selling of financial instruments
They provide insurance against financial losses
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How does the money market help businesses manage their cash flow?
By providing long-term financing options
By providing insurance against financial losses
By providing short-term borrowing options
By providing investment opportunities
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What is the function of the money market?
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What types of financial instruments are commonly traded in the money market?
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