Question

Statement-I: The basic function of a Stock Exchange is the creation of a continuous market where securities are bought and sold.
Statement-II: The Stock Exchange provides both liquidity and easy marketability to already existing securities in the market.

• A. Statement-I is true and Statement-II is false.
• B. Statement-II is true and Statement-I is false.
• C. Both the Statements are true.
• D. Both the Statements are false.

Hint:

Stock exchanges play a critical role in ensuring liquidity, price discovery, and continuous trading for securities.

Answer 1

The Correct Option is C

Step 1: Analyzing Statement-I.
Stock exchanges are primarily responsible for establishing and maintaining a continuous market. This function facilitates the regular buying and selling of securities.

Step 2: Analyzing Statement-II.
The essential roles of stock exchanges include ensuring liquidity and marketability. These allow investors to convert securities into cash efficiently through an active trading environment.

Conclusion: Both statements accurately reflect the core functions of a stock exchange. Therefore,

(C) is the correct choice.