McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Commerce (B Com) .
Chapters
| 101. |
The banker has a statutory obligation to......... |
| A. | Honour customers' cheque |
| B. | Exercise lien |
| C. | Maintain secrecy of his customers' accounts |
| D. | Honour customers' bill |
| Answer» A. Honour customers' cheque | |
| 102. |
The banker has a lien on........ |
| A. | Bonds given for collection |
| B. | Bonds given for safe custody |
| C. | Bonds left by mistake |
| D. | (a) and (b) together |
| Answer» A. Bonds given for collection | |
| 103. |
Neither possession nor ownership is transferred in.... |
| A. | Pledge |
| B. | mortgage |
| C. | Hypothecation |
| D. | none |
| Answer» C. Hypothecation | |
| 104. |
A mortgage can neither sue for foreclosure nor for sale of the property in............... |
| A. | English mortgage |
| B. | Usufructuary mortgage |
| C. | Mortgage by conditional sale |
| D. | none |
| Answer» B. Usufructuary mortgage | |
| 105. |
A banker's lien is........... |
| A. | general lien |
| B. | particular lien |
| C. | Negative lien |
| D. | none |
| Answer» A. general lien | |
| 106. |
A pledge can be made in respect of.... |
| A. | Shares |
| B. | Building |
| C. | Book debts |
| D. | none |
| Answer» A. Shares | |
| 107. |
A bank finances an agriculturist to buy a tractor. The loan is secured by: |
| A. | Hypothecation of the tractor |
| B. | Mortgage of the tractor |
| C. | Pledge of the tractor |
| D. | Assignment of the tractor |
| Answer» A. Hypothecation of the tractor | |
| 108. |
Bank A grants an overdraft to ABC Ltd against book debts. This is secured by: |
| A. | hypothecation |
| B. | pledge |
| C. | mortgage |
| D. | assignment |
| Answer» D. assignment | |
| 109. |
Mortgage is defined under |
| A. | contract act |
| B. | sale of goods act |
| C. | transfer of property act |
| D. | none of the above |
| Answer» C. transfer of property act | |
| 110. |
The mortgager transfers the mortgaged property to the mortgagee on the condition that it will be retransferred upon payment of mortgaged money. This is |
| A. | Simple mortgage |
| B. | English mortgage |
| C. | Equitable mortgage |
| D. | mortgage by conditional sale |
| Answer» B. English mortgage | |
| 111. |
In the case of a joint stock co the registration of a charge is not required with registrar of companies for |
| A. | Pledge of moveable property |
| B. | hypothecation of moveable property |
| C. | assignment of book debts |
| D. | mortgage of fixed assets |
| Answer» A. Pledge of moveable property | |
| 112. |
RAM a transporter has been granted a loan for purchase of a truck. You will create which of the following charge. |
| A. | Assignment |
| B. | a mortgage |
| C. | pledge |
| D. | hypothecation |
| Answer» D. hypothecation | |
| 113. |
Hypothecation is a mode of security provided in |
| A. | Indian contract act 1872 |
| B. | transfer of property act 1882 |
| C. | banking regulation act 1949 |
| D. | SARFAESI Act 2002 |
| Answer» D. SARFAESI Act 2002 | |
| 114. |
Under Hypothecation charge |
| A. | The ownership and possession of goods are with Bank |
| B. | The ownership is with borrower but possession is with Bank |
| C. | The ownership and possession are with borrower |
| D. | The ownership is with Bank but possession with borrower |
| Answer» C. The ownership and possession are with borrower | |
| 115. |
Stamp duty on which of the following documents does not vary from state to state. |
| A. | Mortgage of agreements |
| B. | hypothecation agreements |
| C. | guarantees |
| D. | bills of exchange |
| Answer» D. bills of exchange | |
| 116. |
Mortgage borrowers must pay 20 percent of the home’s purchase price at closing as a down payment. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» B. False | |
| 117. |
As a fixed-rate mortgage nears maturity, the portion of the monthly mortgage payment that is applied to principal _________ while the amount that is applied to interest ___________. |
| A. | Decreases; increases |
| B. | Increases; decreases |
| C. | Does not change; decreases |
| D. | Increases; does not change |
| Answer» B. Increases; decreases | |
| 118. |
. _________ paid at closing can reduce the interest rate used to determine the monthly payments on a mortgage. |
| A. | Discount points |
| B. | Down payments |
| C. | Loan origination fees |
| D. | Amortization rates |
| Answer» A. Discount points | |
| 119. |
What type of mortgages are used to finance the acquisition of apartment complexes, townhouses, and condominiums? |
| A. | Commercial mortgages |
| B. | Single family mortgages |
| C. | Farm mortgages |
| D. | Multifamily dwelling mortgages |
| Answer» D. Multifamily dwelling mortgages | |
| 120. |
As part of a mortgage agreement, a financial institution places a lien on the property until the loan is paid in full. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 121. |
Benefits of securitization include all of the following EXCEPT: |
| A. | Reduced credit risk |
| B. | Generation of income |
| C. | Greater reserve requirements |
| D. | Increased liquidity |
| Answer» C. Greater reserve requirements | |
| 122. |
FHA mortgages and VA mortgages are conventional mortgages. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» B. False | |
| 123. |
When a financial institution sells a mortgage with recourse, the financial institution retains a credit risk liability in the event the buyer returns the mortgage. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 124. |
Where a person pledges goods in which he has only a limited interest, the pledge is: |
| A. | Invalid to the extent of that interest |
| B. | Entire contract is invalid |
| C. | Valid to the extent of that interest |
| D. | Entire contract is valid |
| Answer» C. Valid to the extent of that interest | |
| 125. |
What is pledge: |
| A. | The bailment of goods as security for payment of a debt or performance of a promise |
| B. | The delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the direction of the person delivering them |
| C. | A contract by which one party promises to save the other from loss caused to him by the contract of the promisor himself, or by the conduct of any other person |
| D. | A contract to do or not to do something, if some event, collateral to such contract, does or does not happen |
| Answer» A. The bailment of goods as security for payment of a debt or performance of a promise | |
| 126. |
When banker received deposits from the customer, then the banker becomes -------------- of the customer. |
| A. | Debtor |
| B. | Creditor |
| C. | Bailee |
| D. | Trustee |
| Answer» A. Debtor | |
| 127. |
If cheque is crossed an account payee, this is direction of, ------------- to---------------. |
| A. | Payee, paying banker |
| B. | Payee, collecting bank |
| C. | Drawer, paying bank |
| D. | Drawer, collecting bank |
| Answer» D. Drawer, collecting bank | |
| 128. |
In case of collection of cheques and bills, the relationship of the banker with the customer is that of |
| A. | Bank as agent and customer trustee |
| B. | Bank as trustee and customer debtor |
| C. | Banker as debtor and customer bailee |
| D. | Banker as bailor and customer bailee |
| Answer» A. Bank as agent and customer trustee | |
| 129. |
In case collection of a bank draft the collecting banker is protected against conversion under _____ section of Negotiable Instruments Act 1881. |
| A. | 131 |
| B. | 131 A |
| C. | 85 |
| D. | 128 |
| Answer» B. 131 A | |
| 130. |
A cheque has been deposited by a customer with his bank for collection. The bank allows overdraft against the security thereof. The bank becomes |
| A. | Holder of the cheque |
| B. | Holder in due course |
| C. | Holder for value |
| D. | Drawer of the cheque |
| Answer» C. Holder for value | |
| 131. |
Who can file a criminal case against the drawer of a dishonored cheque? |
| A. | The payee |
| B. | The holder in due course |
| C. | Both of the above |
| D. | The paying banker |
| Answer» C. Both of the above | |
| 132. |
The best answer for returning a cheque for want of funds in the account is......... |
| A. | Refer to drawer |
| B. | Not provided for |
| C. | Exceeds arrangement |
| D. | Not sufficient funds |
| Answer» D. Not sufficient funds | |
| 133. |
Bankers undertake the duty of collection of cheques and bills because...... |
| A. | Sec.131 of the NI Act compels them to do so |
| B. | Sec.85 of the NI Act compels them to do so |
| C. | They want to do it as a service |
| D. | Collection is a must for a crossed cheque |
| Answer» C. They want to do it as a service | |
| 134. |
A collecting banker is given protection only when he collects |
| A. | A crossed cheque |
| B. | An order cheque |
| C. | An Bearer Cheque |
| D. | An mutilated cheque |
| Answer» A. A crossed cheque | |
| 135. |
Collecting a cheque payable to the firm to the private account of a partner without enquiry constitutes....... |
| A. | gross negligence |
| B. | Negligence under remote grounds |
| C. | Negligence connected with immediate collection of a cheque |
| D. | Contributory Negligence |
| Answer» C. Negligence connected with immediate collection of a cheque | |
| 136. |
A Collecting banker is given the statutory protection only when he acts as... |
| A. | A banker |
| B. | A holder for value |
| C. | A holder in due course |
| D. | An agent |
| Answer» D. An agent | |
| 137. |
To get protection under Sec 131 of NI Act collecting banker should collect the cheque |
| A. | crossed generally |
| B. | crossed specially |
| C. | 1 or 2 |
| D. | crossed a/c payee |
| Answer» C. 1 or 2 | |
| 138. |
The endorsement on the cheque is fictitious and the collecting banker failed to check it the cheque is paid by the paying banker |
| A. | collecting banker is not protected |
| B. | paying banker is protected |
| C. | collecting banker & paying banker are protected |
| D. | both are not protected |
| Answer» B. paying banker is protected | |
| 139. |
In case of wrongful dishonour of a cheque by the banker |
| A. | the holder can claim from drawee bank |
| B. | the holder can claim from collecting bank |
| C. | the remedy for holder is against drawer |
| D. | holder can claim from drawee bank, collecting bank, drawer |
| Answer» C. the remedy for holder is against drawer | |
| 140. |
When the cheque is dishonored, the collecting banker is not bound to give notice of the same to his customer within a reasonable time. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» B. False | |
| 141. |
The collecting banker is bound to show due care and carefulness in the collection of cheques presented to him. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 142. |
In case a collecting banker has realized the cheque, he should pay the interest to the customer as per his (customer’s) direction. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 143. |
Holder is an individual who has lawfully received possession of a Commercial Paper, such as a cheque and who is entitled for payment on such instrument. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 144. |
There is legal obligation for a banker to collect the bills of exchange for its customer. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» B. False | |
| 145. |
Which one of the following is the ratio of the loan principal to the appraised value? |
| A. | Combined Loan To Value: (CLTV) ratio |
| B. | Loan-to-Value Ratio |
| C. | Mortgage Loan |
| D. | Statutory Liquidity Ratio |
| Answer» B. Loan-to-Value Ratio | |
| 146. |
What is the product of the share price and number of the company's outstanding ordinary shares? |
| A. | Market Capitalization |
| B. | Market Price |
| C. | Market Trend |
| D. | Treasury Stock |
| Answer» A. Market Capitalization | |
| 147. |
Which one of the following pools money from various investors in order to purchase securities? |
| A. | Fund derivative |
| B. | Money fund |
| C. | Mutual fund |
| D. | Pension fund |
| Answer» C. Mutual fund | |
| 148. |
Which one of the following is the rate at which the RBI lends money to commercial banks in the event of any shortfall of funds? |
| A. | Benchmark Prime Lending Rate |
| B. | Annual Percentage Rate |
| C. | Bank Rate |
| D. | Repo Rate |
| Answer» D. Repo Rate | |
| 149. |
When financial institutions and banks undertake activities related to banking like investment, issue of debit and credit card etc then it is known as _____________________. |
| A. | Internet banking |
| B. | Universal banking |
| C. | Virtual Banking |
| D. | Wholesale banking |
| Answer» B. Universal banking | |
| 150. |
Collateral securities can be _____? |
| A. | Tangible |
| B. | Intangible in the shape of personal guarantee of a third party |
| C. | security given to get credit facilities/loan |
| D. | All of the above |
| Answer» D. All of the above | |
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