6. The main objective of capital market instruments is to:
a) Generate capital appreciation
b) Provide liquidity to investors
c) Preserve principal investment
d) Raise capital for businesses
7. Which of the following is an advantage of investing in capital market instruments?
a) High degree of liquidity
b) Higher potential returns
c) Guaranteed returns
d) Lower risk compared to other investments
8. Eurobonds are capital market instruments that are:
a) Issued in a foreign currency
b) Exclusively issued by European companies
c) Only traded on European stock exchanges
d) Issued by the European Central Bank
9. Which of the following is a primary market transaction?
a) Buying a stock on a stock exchange
b) Trading a government bond on a secondary market
c) Selling a corporate bond to an initial investor
d) Exchanging currency at a bank
10. Corporate stocks are considered capital market instruments because they represent:
a) Ownership in a corporation
b) Debt owed by the corporation
c) Derivative contracts
d) Insurance policies
