A  capital market differs from the money market in that in the former ________?

A. The percentage of interest charged is more
B. Loan sought is long term
C. Loan repayment is guaranteed
D. Loan sought is short-term

Correct Answer:

Option B – Loan sought is long term

Explanation

Basically the difference between the capital markets and money markets is that capital markets are for long term investments, companies are selling stocks and bonds in order to borrow money from their investors to improve their company or to purchase assets. Whereas money markets are more of a short term borrowing.