The capital market is the market for:

• A. short-term money instruments like Treasury bills
• B. long-term financial assets such as stocks and bonds
• C. consumer goods and services
• D. labor and employment contracts

Answer: (B)

Verified step by step guidance

1. Understand the definition of the capital market: It is a financial market where long-term debt or equity-backed securities are bought and sold.
2. Recognize that short-term money instruments like Treasury bills are traded in the money market, not the capital market.
3. Identify that consumer goods and services are exchanged in product markets, which are different from financial markets.
4. Know that labor and employment contracts are part of the labor market, which deals with the supply and demand of labor.
5. Conclude that the capital market specifically deals with long-term financial assets such as stocks and bonds.