Correct Answer: Short-term debt instruments

Solution : The correct answer is (c) Short-term debt instruments.

The money market is a component of the financial market that deals with short-term borrowing and lending of funds. It focuses on highly liquid, low-risk, and short-term debt instruments. These instruments typically have maturities of one year or less. The money market provides a platform for participants to engage in the trading of these short-term debt instruments.

Examples of short-term debt instruments traded in the money market include Treasury bills, certificates of deposit (CDs), commercial paper, repurchase agreements (repos), and short-term government bonds.