Money Market is primarily used for:

• A. For long-term investments
• B. For short-term borrowing under a year
• C. For trading real estate
• D. For central bank operations

Answer: (B)

The money market is about short-term financing and liquidity management, with maturities up to one year. That makes its primary use the ability for participants to borrow or lend quickly to cover short-term funding needs or to park excess cash safely. In practice, firms and banks use instruments like Treasury bills, commercial paper, certificates of deposit, and repurchase agreements to meet these short-term needs. Long-term investments belong in the capital markets, not the money market, and trading real estate is not part of money-market activity. While central banks do engage in money-market operations as part of monetary policy, the everyday, primary purpose for participants is short-term borrowing under a year.