In the capital market, mortgages, bonds, equities and other such investment funds are traded. Choose the best description for a capital market:

A.A capital market is a market where only the government collect long term funds to trade securities on the bond and the stock market. B.A capital market consists of both the primary market where existing issues are distributed among investors. C. A capital market will help to assist the procedure whereby investors with excess funds can channel them to investors in deficit. D.A capital market provides both overnight and short- term funds and uses financial instruments with medium maturity periods.

(2 marks)

Under Malaysian Capital Market, there are two markets that we can look at, which are cash market and derivative market.

A.True B.False (2 marks)

The term of initial public offerings (IPOs) refers to the selling of a firms ordinary shares to the public for the second time.

A.True B.False (2 marks)

When an investment banker purchases the entire issue from the issuer and resells the security to the investing public, this function falls under what we call as an underwriting function.

A.True B.False (2 marks)

Treasury Notes, Treasury Bills and Treasury Bonds are all considered as government bond issues.

A.True B.False (2 marks)

When financial instruments are being derived from other forms of assets, they were called as derivatives, and the examples are like futures as well as preference shares.

A.True B.False