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Ch.1 · Savings vs Investment Avenues · easy

Which of the following is NOT a money market instrument?

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EXPLANATION

Money market instruments have maturity of up to 1 year. A 10-year Government Security is a capital market instrument (long-term debt). T-Bills, CPs, and CDs within 1-year maturity are all money market instruments.

A.91-day Treasury Bill

B.Commercial Paper with 6-month maturity

C.Certificate of Deposit with 3-month maturity

D.10-year Government Security (G-Sec) [✓ Correct]

EXPLANATION

Money market instruments have maturity of up to 1 year. A 10-year Government Security is a capital market instrument (long-term debt). T-Bills, CPs, and CDs within 1-year maturity are all money market instruments.

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