Multiple choice

Call Money Market is

  1. the market that provides money on making a call

  2. the market for one day loans which banks access to meet their reserve requirements or to cover a sudden shortfall in cash on a particular day

  3. the market that provides short-term loans for a specified period

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Call Money Market is a segment of the money market where banks borrow and lend funds for extremely short periods - typically overnight or one day. Banks use this to meet reserve requirements or cover temporary cash shortfalls. It is not about making phone calls, and it's distinct from term lending markets with specified periods.

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