CBSE 2025, BS Set 1

Question

'Through the process of disinvestment and reinvestment, savings get channelized into their most productive investment avenues.'

The function of the stock exchange highlighted above is: A). Spreading of equity cult B). Providing liquidity and marketability to existing securities C). Contributing to economic growth D). Providing scope for speculation

Edvaya · Accepted Answer

The correct answer is Contributing to economic growth. **Contributing to economic growth** is correct. The statement describes how the stock exchange channels savings from less productive to more productive investments through disinvestment and reinvestment. This process allocates capital to the most productive sectors, thereby contributing to **economic growth**. - **Spreading of equity cult**: Refers to encouraging wider share ownership, not the reallocation described. - **Providing liquidity and marketability to existing securities**: Refers to easy buying/selling of existing securities. - **Providing scope for speculation**: Refers to short-term profit-seeking trades.

Edvaya Target

Edvaya Aspire

Take a Free Mock Test

Target Subjects

Aspire Subjects

Subject Mastery

Business Studies > Business Finance > Financial Markets

Keep Practicing

Edvaya Target

Current Question

Community Stats

Track Your Progress

Quick Actions

We Value Your Privacy