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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


Team Careers360 15th Jan, 2024
Answer (1)
Team Careers360 21st Jan, 2024

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.

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