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Business Studies · 2025 · 4 marks
CBSE 2025 · Region 1 · Set 1 · Q28
‘Tech Work' an Artificial Intelligence (AI) startup startedin 2024. It was earning good profits. It wanted to expand itsbusiness and for its research and development, it required₹$\displaystyle 100$ crores.The Chief Executive Officer of ‘Tech Work’ consulted theFinance Manager who suggested that there is a market whichfacilitates transfer of investible funds from savers toentrepreneurs seeking to establish new enterprises or expandexisting ones through the issue of securities.The management of ‘Tech Work' decided to raise funds fromthe investors by issuing equity shares ₹$\displaystyle 200$ per share for thefirst time.(i)Name the type of capital market through which ‘TechWork' decided to raise funds for its expansion.(ii)State three features of the market identified in (i) above.
‘Tech Work' an Artificial Intelligence (AI) startup started
in 2024. It was earning good profits. It wanted to expand its
business and for its research and development, it required
₹$\displaystyle 100$ crores.
The Chief Executive Officer of ‘Tech Work’ consulted the
Finance Manager who suggested that there is a market which
facilitates transfer of investible funds from savers to
entrepreneurs seeking to establish new enterprises or expand
existing ones through the issue of securities.
The management of ‘Tech Work' decided to raise funds from
the investors by issuing equity shares ₹$\displaystyle 200$ per share for the
first time.
(i)
Name the type of capital market through which ‘Tech
Work' decided to raise funds for its expansion.
(ii)
State three features of the market identified in (i) above.
Marking-scheme solution
(i)
Primary Market/ New Issue Market
(ii)
Features of the Primary market:
(a)
There is sale of securities by new companies or further
(new issues of securities by existing companies to investors).
(b)
Securities are sold by the company to the investor directly
(or through an intermediary).
(c)
The flow of funds is from savers to investors, i.e. the primary
market directly promotes capital formation.
(d)
Only buying of securities takes place in the primary market,
securities cannot be sold there.
(e)
Prices are determined and decided by the management of the
company.
(f)
There is no fixed geographical location.
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CBSE Class 12 Business Studies past-paper question from the 2025board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.