Question : Case Study 83
ABC Corporation is a conglomerate that has recently traded its shares on a stock exchange. The company's management is reviewing the development functions of SEBI.
Question :
How does SEBI encourage the development of the securities market?
Option 1: By issuing new shares
Option 2: By providing loans to companies
Option 3: By setting interest rates
Option 4: By regulating stockbrokers
Correct Answer: By regulating stockbrokers
Solution : The correct answer is (d) By regulating stockbrokers
SEBI encourages the development of the securities market by regulating various market participants, including stockbrokers. Effective regulation of stockbrokers ensures that they operate in a fair and transparent manner, adhere to ethical practices, and provide reliable services to investors. This fosters investor confidence and promotes market growth. In addition to regulating stockbrokers, SEBI undertakes various other developmental functions, such as formulating policies to enhance market efficiency, encouraging new entrants and innovations, setting disclosure norms, and implementing measures to improve market infrastructure. All these efforts collectively contribute to the development and growth of the securities market.




