Which of the following statements is incorrect regarding Financial Markets?
A. The process by which allocation of funds is done is called financial intermediation.
B. Money market instruments are close substitutes for money.
C. The difference between the price at which the treasury bills are issued and their redemption value is the interest receivable on them and is maturity value.
D. Treasury Bills are issued at a price which is lower than their face value and repaid at par.
Answer:C
Which of the following statements is incorrect regarding Financial Markets?
A. The process by which allocation of funds is done is called financial intermediation. B. Money market instruments are close substitutes for money. C. The difference between the price at which the treasury bills are issued and their redemption value is the interest receivable on them and is maturity value. D. Treasury Bills are issued at a price which is lower than their face value and repaid at par.
Explanation: The difference between the price at which the treasury bills are issued and their redemption value is the interest receivable on them and is called discount.