12th Commerce - Book Back Answers - Chapter 4 - English Medium Guides

  

 

Plus Two / 12th Commerce - Book Back Answers - Chapter 4 - English Medium

Tamil Nadu Board 12th Standard Commerce - Chapter 4: Book Back Answers and Solutions

    This post covers the book back answers and solutions for Chapter 4 – Commerce from the Tamil Nadu State Board 12th Standard textbook. These detailed answers have been carefully prepared by our expert teachers at KalviTips.com.

    We have explained each answer in a simple, easy-to-understand format, highlighting important points step by step under the relevant subtopics. Students are advised to read and memorize these subtopics thoroughly. Once you understand the main concepts, you’ll be able to connect other related points with real-life examples and confidently present them in your tests and exams.

    By going through this material, you’ll gain a strong understanding of Commerce Chapter 4 along with the corresponding book back questions and answers (PDF format).

Question Types Covered:

• 1 Mark Questions: Choose the correct answer, Fill in the blanks, Identify the correct statement, Match the following 
• 2 Mark Questions: Answer briefly 
• 3, 4, and 5 Mark Questions: Answer in detail

All answers are presented in a clear and student-friendly manner, focusing on key points to help you score full marks.

All the best, Class 12 students! Prepare well and aim for top scores. Thank you!

Chapter 4: Introduction To Financial Markets

I.Choose the correct answer.

1. Financial market facilitates business firms
a) To rise funds        
b) To recruit workers
c) To make more sales        
d) To minimize fund requirement
Answer Key:
a) To rise funds

2. Capital markets is a market for
a) Short Term Finance        
b) Medium Term Finance
c) Long Term Finance         
d) Both Short Term and Medium Term Finance
Answer Key:
c) Long Term Finance

3. Primary market is also called as
a) Secondary market            
b) Money market
c) New Issue Market            
d) Indirect Market
Answer Key:
c) New Issue Market

4. Spot Market is a market where the delivery of the financial instrument and payment of cash occurs
a) immediately                
b) In the future
c) Uncertain                
d) After one month
Answer Key:
a) immediately    

5. How many times a security can be sold in a secondary market?
a) Only one time    
b) Two time             
c) Three time               
d) Multiple times
Answer Key:
d) Multiple times

II. Very short answer questions.

1. What are the components of organized sectors?
Answer Key:

 Organized sector consist of 

• Regulators, Financial Institutions, Financial Markets and Financial Services.

The unorganized sector consists of 

• Money Lenders, Indigenous Bankers etc.

2. What is Spot market?
Answer Key:

• Cash/Spot Market is a market where the delivery of the financial instrument and payment of cash occurs immediately.
• i.e. settlement is completed immediately.

3. What is Debt market?
Answer Key:

• Debt Market is the financial market for trading in Debt Instrument.
• i.e. Government Bonds or Securities, Corporate Debentures or Bonds.

4. How is price decided in a Secondary Market?
Answer Key:

• Fluctuates, depends on the demand and supply force

III. Short answer questions.

1. Give the meaning of financial Market?
Answer Key:

• A market wherein financial instruments such as financial claims, assets and securities are traded is known as a ‘financial market’

2. Write a note on Secondary Market?
Answer Key:

• Secondary Market is the market for securities that are already issued.
• Stock Exchange is an important institution in the secondary market.

3. Bring out the scope of Financial Market in India?
Answer Key:

• The financial market provides financial assistance to individuals, agricultural sectors, industrial sectors, service sectors, financial institutions like banks, insurance sectors, provident funds and the government as a whole.
• Through the financial market the institutions get their short term as well as long term financial assistance.
• It leads to the overall economic development.

IV. Long answer questions.

1. Distinguish between New issue market and secondary Market? (any-5)
Answer Key:

Basis	New Issue Market	Secondary Market
Meaning	The market place for new shares is called primary market.	The place where formely issued securities are traded is known as Secondary market.
Buying	Direct	Indirect
How many times securities can be sold?	Only once	Multiple times
Buying and Selling between	Company and Investors	Investors
Gained person	Company	Investors
Intermediary	Underwriters	Brokers

                 
2. Enumerate the different types of Financial Markets? (any-5)
Answer Key:

• On the Basis of Type of Financial Claim
• On the Basis of Maturity of Financial Claim
• On the Basis of Time of Issue of Financial Claim
• On the Basis of Timing of Delivery of Financial Claim
• On the Basis of the Organizational Structure of the Financial Market

3. Discuss the role of financial Market?
Answer Key:
Savings Mobilization:

• Obtaining funds from the savers or ‘surplus’ units such as household individuals, business firms, public sector units, Government is an important role played by financial markets.

Investment:

• Financial market plays a key role in arranging the investment of funds thus collected, in those units which are in need of the same.

National Growth:

• Financial markets contribute to a nation’s growth by ensuring an unfettered flow of surplus funds to deficit units.

Entrepreneurship Growth:

• Financial markets contribute to the development of the entrepreneurial class by making available the necessary financial resources.

Industrial Development:

• The different components of financial markets help an accelerated growth of industrial and economic development of a country and thus contributing to raising the standard of living and the society’s well-being.

 

Prepared By:

 

B. MUTHUKUMAR 
PG ASST COMMERCE
MKVK MATRIC HR SEC SCHOOL 
TENKASI