Question : Case Study 6:
DEF Ltd. is a startup in the fashion industry that wants to raise funds for launching its new line of products.
Question :
To raise short-term funds for marketing its new products, which money market instrument might DEF Ltd. consider?
Option 1: Debenture
Option 2: Call money
Option 3: Corporate bond
Option 4: Equity share
Correct Answer: Call money
Solution : The correct answer is (b) Call money
To raise short-term funds for marketing its new products, DEF Ltd. might consider utilizing call money. Call money is a short-term borrowing facility used by banks and other financial institutions to meet their short-term funding needs. It allows them to borrow funds for a very short duration, usually overnight or for a few days. DEF Ltd. can access call money to finance its short-term marketing activities, promoting and launching its new line of products. This form of borrowing is appropriate for short-term needs and provides the required flexibility for short-duration funding.
Question : Case Study 19:
MNO Ltd. is a startup in the food and beverage sector aiming to raise funds for expanding its product range.
To raise short-term funds for marketing its expanded product range, which money market instrument might MNO Ltd. use?
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