Class 12 Business Studies - RAJASTHAN
Financial Markets
The chapter 'Financial Markets' in Class 12 Business Studies for Rajasthan Board (RBSE) explores the crucial link between savers and investors. It covers the meaning and types of financial markets, primarily the Money Market and Capital Market. Students will learn about the functions of financial markets, the role of the Securities and Exchange Board of India (SEBI) as a regulatory body, and the distinction between primary and secondary markets. This chapter is vital for board exams as it tests both conceptual understanding and procedural knowledge of how corporate finance is raised and traded in India.
Start Learning FreeKey Concepts
Financial Market
A market that creates and exchanges financial assets, linking households that save money with business firms that need funds.
Money Market
A market for short-term funds with a maturity period of up to one year, dealing in instruments like Treasury Bills, Commercial Paper, and Call Money.
Capital Market
A market that deals in medium and long-term funds, comprising both primary and secondary markets where shares and debentures are issued and traded.
Primary Market
Also known as the new issue market, where companies raise fresh capital by issuing new securities directly to investors.
Secondary Market
Also known as the stock exchange, where existing securities are bought and sold among investors, providing liquidity.
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 Rajasthan Board (RBSE) Class 12 Business Studies exams, this chapter typically carries around 6 to 8 marks. Questions often include differentiating between Capital Market and Money Market, Primary and Secondary Markets, and explaining the regulatory functions and objectives of SEBI.
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 medium and long-term funds exceeding one year.
Can a company issue shares directly in the Secondary Market?
No, new securities are always issued in the Primary Market. The Secondary Market is only for trading existing securities between investors.
What are the primary functions of SEBI?
SEBI's functions are categorized into protective functions, developmental functions, and regulatory functions to ensure fair play and investor protection.
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