Class 12 Business Studies - ODISHA
Financial Markets
The chapter Financial Markets in Class 12 Business Studies for Odisha BSE students explores the core arena where financial assets are created and traded. It covers the crucial link between savers and investors through two main segments: the Money Market and the Capital Market. Students will learn about the role of financial markets, the distinction between primary and secondary markets, and the functioning of regulatory bodies like SEBI. Mastering this chapter is essential for board exams as it carries substantial weightage, featuring both direct theoretical questions and practical case-study problems related to stock exchanges and financial instruments.
Start Learning FreeKey Concepts
Financial Market
A market that creates and exchanges financial assets, acting as a bridge between those who have surplus funds (savers) and those who need funds (investors).
Money Market
A market for short-term funds with maturity ranging from a few days up to one year, dealing in instruments like Treasury Bills, Commercial Paper, and Call Money.
Capital Market
A market that meets the long-term and medium-term financial requirements of business enterprises, comprising both primary and secondary markets.
Primary Market
Also known as the new issue market, it is where securities are issued for the first time directly by the company to investors.
Secondary Market
Also known as the stock market or stock exchange, it is where existing securities are bought and sold among investors.
SEBI (Securities and Exchange Board of India)
The apex regulatory body established to protect the interests of investors in securities and to promote the development of the securities market.
Important Formulas
Board Exam Info
In the Odisha (BSE) Class 12 Business Studies board examination, the Financial Markets chapter typically carries around 8 to 12 marks. Questions usually include very short-answer questions (1 mark), short-answer questions (2-3 marks), and long-answer/essay-type questions (4-6 marks) often focusing on the functions of stock exchanges, the role of SEBI, or the differences between money and capital markets.
Frequently Asked Questions
What is the main difference between Money Market and Capital Market?
Money market deals in short-term funds up to one year, while capital market deals in long-term and medium-term funds exceeding one year.
Can a company issue shares directly in the Secondary Market?
No, a company issues shares for the first time in the Primary Market. The Secondary Market is only for trading existing securities between investors.
What are the main functions of SEBI?
SEBI's main functions are protective (preventing unfair trade practices), developmental (training intermediaries and promoting market growth), and regulatory (framing rules and regulations for market participants).
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