Instruments of Money Market

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Here are some MCQs on Instruments of Money Market

1. Which of the following instruments is generally used by governments to finance their short-term borrowing needs?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: a) Treasury bills
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2. What is the typical maturity period for a Treasury bill?

a) 30 days

b) 60 days

c) 90 days

d) 180 days

Answer: c) 90 days
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3. Which of the following instruments is issued by corporations to raise short-term funds?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: b) Commercial paper
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4. What is the typical maturity period for commercial paper?

a) 30 days

b) 60 days

c) 90 days

d) 180 days

Answer: c) 90 days
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5. Which of the following instruments is issued by banks to raise short-term funds?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: c) Certificates of deposit
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