EconomicsNEB 2082

State any one difference between money market and capital market.

1

Answer

Risk Level (Low → High)Return Potential (Low → High)OMoney MarketCapital MarketLow risk, low return (e.g., Treasury Bills, CDs)••High risk, high return (e.g., Stocks, Bonds)••
Risk-return tradeoff: Money Market (short-term, low risk) vs. Capital Market (long-term, higher risk).
≤1 yearMoney Market(e.g., Treasury Bills,>1 yearCapital Market(e.g., Bonds, Stocks)
Maturity period comparison: Money Market (short-term) vs. Capital Market (long-term).

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