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1 FINANCE MCQS

Financial instruments are first traded in money markets and then in __________?

  • Money markets
  • Capital markets
  • Debt markets
  • Economic markets
Correct Answer: B. Capital markets

Detailed Explanation

Money markets deal with short-term financial instruments such as treasury bills, commercial papers, and certificates of deposit. Once these instruments or funds are moved to long-term financing, they are traded in capital markets. Capital markets handle securities like stocks and bonds, which are used for long-term investment and growth financing.

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