Consider the following markets:

  1. Acceptance market
  2. Bond market
  3. Discount market
  4. Collateral loan market

Which of the above are specialized sub markets of a money market?

Answer: [A] 1, 3 & 4 Only

Short-term credit market is called money market. An acceptance is a time draft or bill of exchange that is accepted as payment for goods and services. It is a common method of financing short-term debts in international trade including import-export transactions. The bond market is where debt securities are issued and traded. Discount market is a short-term money market comprising of banks, discount houses, and money brokers (called bill brokers) who discount bills of exchange.  Collateral is something that helps secure a loan. It is associated to long term financial market.

This question is a part of GKToday's Integrated IAS General Studies Module