Financial Markets: Class 12 Previous Year Questions

Financial Markets questions asked in CBSE board exams

Repeated questions first. Open the free app to see each question as it appeared in the paper, with its marking scheme.

1. Read the following statements – Assertion (A) and Reason (R) : 1 Assertion (A) : Money market instruments have a higher degree of liquidity as compared to capital market securities. Reason (R) : Money market instruments are traded on the stock exchanges. Choos…
   Board 20261 markAssertion-Reason
2. Statement – I : Capital market instruments are safer than money market instruments both with respect to returns and principal repayment. Statement – II : The capital market deals in medium and long-term securities such as equity shares and debentures etc. Choo…
   Board 20261 markMCQ
3. Ria ran a small online bakery business. Her business was doing very well. She saved a good amount of money every month and now wanted to invest it wisely. She was in a dilemma to keep her savings in a bank account or to invest it in the stock market. Her frien…
   Board 20266 markslong answer
4. ‘Stock Exchange is playing a vital role in ensuring wider share ownership by regulating new issues, better trading practices and taking effective steps in educating the public about investments.’ The above lines highlight which function of stock exchange from …
   Board 20261 markMCQ
5. Explain the following functions of Stock Exchange : 21. (a) (i) Providing liquidity and marketability to existing securities (i) Pricing of securities (ii) Safety of transaction OR (b) Differentiate between ·Primary Market' and ·Secondary Market' on the basis …
   Board 20253 marksshort answer
6. (a) Give the meaning of 'Capital Market'. Differentiate between Capital Market' and 'Money Market' on the basis of : (i) Participants (ii) Instruments OR (b) State any three Regulatory functions' of Securities and Exchange Board of India. 19 25. a) : (i) (b) (…
   Board 20253 marksshort answer
7. ·Tech Work' an Artificial Intelligence (AI) startup started in 2024. It was earning good profits. It wanted to expand its business and for its research and development, it required 100 crores. The Chief Executive Officer of ·Tech Work' consulted the Finance Ma…
   Board 20254 marksshort answer
8. (a) existing securities, but performs many Explain any two such functions of Stock Exchange. 4 OR (b) Distinguish between primary market and secondary market on any four bases.
   Board 20234 marksshort answer
9. Statement - I : Capital market instruments are considered riskier both with respect to returns and principal repayment. Statement - II : Capital market investment generally yields a higher return for investors. Choose the correct option from the options given …
   Board 20231 markMCQ
10. (a) (i) Name the process of holding securities in an electronic form. (ii) Name any two participants of Money Market. (iii) Name the depositories that hold securities in electronic form. 3 OR (b) State any three factors affecting the dividend decision.
    Board 20233 marksshort answer
11. KLM Bank Ltd. is a leading bank with various branches across the country. On 27th Jan. 2022, it faced a sudden temporary shortage in cash balance in one of its branches. On the same day, it was decided by its directors to borrow funds from another bank for two…
    Board 20221 markvery short
12. Which among the following sentences is true? A. Primary market enhances liquidity. B. Secondary market is located at specified places. C. In the secondary market, only buying of securities take place. 1 D. In the primary market, prices are determined by demand…
    CBSE practice 2022-231 markMCQ
13. A prudent finance manager has to make several financing decisions in the course of their work. Describe any six factors that will influence their decision.
    CBSE practice 2022-236 markslong answer
14. Mention any three protective functions of SEBI. 3 OR Explain any three methods of floating new issues in the primary market.
    CBSE practice 2022-233 marksshort answer
15. Design a comprehensive investment plan for a person seeking advice on short-term investment options, outlining three specific instruments of the money market that can be recommended for short-term investments. Provide detailed explanations for each instrument,…
    CBSE practice 2023-243 marksshort answer
16. Which of the following is an instrument of the money market? A. bonds B. T-bills C. debentures D. equity shares
    CBSE practice 2022-231 markMCQ
17. Match the terms given in column 1 with their meaning given in column2: Column1 Column2 1. Financial Intermediation (i)Facilities and institutional arrangements through which long term funds both equity and debt are raised and invested 2. Primary market (ii) th…
    Sample paper 2026-271 markMCQ

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