Which of the following statements is not true with regard to capital market?Answer choicesSelect only one optionREVISITBoth debt and equity funds can be raised.The funds are raised for a short period of timeThe funda are raised for Long PeriodIt is classified into two types.
Question
Which of the following statements is not true with regard to capital market?Answer choicesSelect only one optionREVISITBoth debt and equity funds can be raised.The funds are raised for a short period of timeThe funda are raised for Long PeriodIt is classified into two types.
Solution
The statement that is not true with regard to capital market is: "The funds are raised for a short period of time".
Capital markets are venues where savings and investments are channeled between the suppliers who have capital and those who are in need of capital. The entities that have capital include retail and institutional investors while those who seek capital are businesses, governments, and people.
The funds in capital markets are typically raised for long periods of time, not short. This is because capital markets are used for long-term investments usually over a year. This includes the stock market and bond market. Therefore, the statement "The funds are raised for a short period of time" is not true with regard to capital market.
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