Class 12 Business Studies - TAMILNADU
Financial Markets
The chapter 'Financial Markets' in Class 12 Business Studies for Tamil Nadu (Samacheer Kalvi) explores the institutional arrangements through which financial assets are created and traded. It explains the core components of the Indian financial system, primarily divided into the Money Market and the Capital Market. Students will learn about financial instruments like treasury bills, commercial paper, equity shares, and debentures, as well as the role and functions of regulatory bodies such as SEBI (Securities and Exchange Board of India). Mastering this chapter is essential for understanding how capital is mobilized in the economy and forms a high-scoring section in board exams.
Start Learning FreeKey Concepts
Financial Market
A marketplace where buyers and sellers trade financial assets such as stocks, bonds, currencies, and derivatives.
Money Market
A market for short-term financial assets and instruments with a maturity period of up to one year, catering to the liquidity needs of businesses and banks.
Capital Market
A market for long-term securities, comprising both primary and secondary markets, where companies and governments raise long-term funds.
Primary Market
Also known as the new issue market, it deals with the issuance of new securities to investors for the first time through IPOs.
Secondary Market
Commonly known as the stock exchange, it is a platform where previously issued securities are bought and sold among investors.
SEBI (Securities and Exchange Board of India)
The statutory regulatory body established to protect the interests of investors in securities and to promote and regulate the development of the securities market.
Important Formulas
Board Exam Info
In the Tamil Nadu (Samacheer Kalvi) Class 12 Business Studies board examination, this chapter typically carries around 8 to 12 marks. Questions usually include multiple-choice questions (MCQs), very short answers (distinguishing between money market and capital market), short notes (functions of SEBI, primary vs secondary market), and long-form descriptive essays.
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) with high liquidity and low risk, whereas capital market deals in long-term funds (exceeding one year) for capital growth and infrastructure development.
What are the primary functions of SEBI?
SEBI's functions include protective functions (preventing insider trading), developmental functions (training intermediaries and promoting investor education), and regulatory functions (regulating stock brokers and mutual funds).
What is a Treasury Bill?
A Treasury Bill (T-Bill) is a short-term money market instrument issued by the Reserve Bank of India on behalf of the Central Government to meet short-term liquidity requirements.
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