Blank 1 Question 4[select: , Primary markets, Secondary markets, Capital markets, Money markets] are Markets in which longer-term securities are issued and traded with original term-to-maturity of more than one year, whereas Blank 2 Question 4[select: , primary markets, secondary markets, capital markets, money markets] are Wholesale markets in which short-term securities are issued and traded.

Question

BlackTom AI · Accepted Answer

To tackle the question, I’ll examine what each term means in the context of market structure. 
Option 1: Capital markets. This choice is correct for Blank 1 because capital markets are the markets where longer-term securities with original maturities of more than one year are issued and traded. They encompass instruments such as bonds and equity that have longer time horizons. 
Option 2: Money markets. This pair is appropriate for Blank 2 since money markets are wholesale markets that deal with short-term securities and debt instruments, typically with maturities of one year or less. They focus on high liquidity and short-term funding. 
Option 3: Primary markets. If selected here, it would be misleading because primary markets refer to where new securities are issued for the first time (initial issuance), not the ongoing trading environment by maturity length. In other words, primary markets describe issuance activity, not a classification by original term-to-maturity or the wholesale/retail nature of trading. 
Option 4: Secondary markets. This option would also be incorrect in this fill because secondary markets relate to the trading of securities after issuance, not specifically to the duration of the instrument or to wholesale short-term trading. They cover a broad range of maturities and do not by themselves define the wholesale short-term nature described in the prompt. 
Option 5: (If considered) Money markets. As noted above, this aligns with Blank 2, not Blank 1, so using it for Blank 1 would be incorrect. 
Option 6: (If considered) Capital markets. Reiterating the reasoning for Blank 1, this is the correct match for longer-term securities, not for short-term wholesale trading. 
In summary, the pair aligns with the concepts: Blank 1 should be Capital markets because of longer-term issuances and trading, while Blank 2 should be Money markets due to their role as wholesale markets for short-term securities. The remaining options fail because they describe different aspects of market structure (issuance vs trading, primary vs secondary) or mismatched maturities, which does not fit the given blanks.

MCD2170 - T3 - 2025 Pre-Class Quiz Week 1

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