Stock Exchange works as a mechanism for valuation of securities through the forces of demand and supply. Identify the related function of performed by the stock exchanges?
(a) Providing liquidity and marketability to existing securities.
(b) Safety of transaction.
(c) Pricing of security.
(d) Spreading of equity cult.
Answer. C
2. PK Enterprises Limited has sold an entire lot of 5,00,000 equity shares @ 9 each to Prosperous Bank Private Limited. The bank intum will offer the shares to general public for subscription @ 11 per share. Identify the method of floatation being described in the given lines?
(a) Private placement
(b) Offer through prospectus
(c) Offer for sale
(d) Rights issue
Answer.C
3. Which of the following participants represent capital market?
(a) Development banks
(b) Commercial banks
(c) Stock exchanges
(d) All of the above
Answer. D
4. A company can raise capital through the primary market in the form of?
(a) Equity shares
(b) Preference shares
(c) Debentures
(d) All of the above
Answer. B
5. It is a short-term, negotiable, self-liquidating instrument which is used to finance the credit sales of firms?
(a) Commercial bill
(b) Commercial papers
(c) Call money
(d) None of the above
Answer. A
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