Question

Q. With reference to the capital and money markets, consider the following statements:

Which of the statements given above is/are incorrect?

• A.
  1 and 2 only
• B.
  3 only
• C.
  2 and 3 only
• D.
  1, 2 and 3

Answer 1

The correct option is A

1 and 2 only
Explanation:

Statement 1 is incorrect: Tenure of the capital market instruments is greater than one year and that of money market instruments is one year.

Statement 2 is incorrect: Money market instruments are of low risk and low returns.

Statement 3 is correct: Money market instruments have more liquidity than the capital market instruments.