McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Master of Commerce (M.com) , Master of Business Administration (MBA) .
Chapters
| 51. |
Which of the following is not a characteristic of a financial instrument? |
| A. | The financial instrument is always issued by a bank. |
| B. | A financial instrument is a written legal obligation of one party to transfer something of value, usually money. |
| C. | The transaction in a financial instrument is specified to take place at a future date. |
| D. | A financial instrument specifies certain conditions. |
| Answer» A. The financial instrument is always issued by a bank. | |
| 52. |
Securities backed by _______ layed an important role in the financial crisis of 2007- 2009? |
| A. | asset backed securities. |
| B. | bonds. |
| C. | sub-prime mortgages. |
| D. | small business loans |
| Answer» C. sub-prime mortgages. | |
| 53. |
Financial instruments are used |
| A. | as a unit of account, as a store of value, and as a means of payment. |
| B. | as a unit of account, as a means of payment, and to transfer risk. |
| C. | as a store of value, as a means of payment, and to transfer risk. |
| D. | as a unit of account, as a store of value, and to transfer risk. |
| Answer» C. as a store of value, as a means of payment, and to transfer risk. | |
| 54. |
Two important characteristics of financial instruments are: |
| A. | information communication and risk neutrality. |
| B. | risk neutrality and liquidity. |
| C. | standardization and information communication. |
| D. | liquidity and standardization. |
| Answer» C. standardization and information communication. | |
| 55. |
Benefits of the merger between the NYSE and Paris-based Euronext, a pan European stock exchange include: |
| A. | lower costs and speedier transactions for international financial markets. |
| B. | foreign ownership of domestic assets. |
| C. | international consolidation of financial services. |
| D. | greater the uncertainty. |
| Answer» A. lower costs and speedier transactions for international financial markets. | |
| 56. |
Which of the following increases the value of a financial instrument? |
| A. | smaller payments. |
| B. | payments made further in the future. |
| C. | payments that are made when we need them. |
| D. | payments that are less likely to be made. |
| Answer» C. payments that are made when we need them. | |
| 57. |
An example of financial instruments that are primarily used as stores of value is: |
| A. | insurance contracts. |
| B. | home mortgages. |
| C. | options. |
| D. | futures contracts. |
| Answer» B. home mortgages. | |
| 58. |
Financial markets serve which three purposes? |
| A. | Financial markets allow-risk sharing, pool and communicate information, and offer stability. |
| B. | Financial markets allow risk sharing, offer stability, and offer liquidity. |
| C. | Financial markets offer stability, pool and communicate information, and offer liquidity. |
| D. | Financial markets allow-risk sharing, pool and communicate information, and offer liquidity. |
| Answer» D. Financial markets allow-risk sharing, pool and communicate information, and offer liquidity. | |
| 59. |
Which of the following is not a function of SEBI: |
| A. | Development of the Securities market |
| B. | Investor Protection |
| C. | Making the Rules and Regulation for the securities market |
| D. | Framing policies for central government operations |
| Answer» B. Investor Protection | |
| 60. |
SEBI operates to fulfill the needs of these three groups, choose the one which is not in those three: |
| A. | the issuers of securities |
| B. | the police |
| C. | the investors |
| D. | the market intermediaries |
| Answer» B. the police | |
| 61. |
SEBI has not been vested with the following powers: |
| A. | to approve by−laws of stock exchanges. |
| B. | to require the stock exchange to amend their by−laws. |
| C. | inspect the books of accounts and call for periodical returns from recognized stock exchanges. |
| D. | inspect the books of accounts of financial intermediaries. |
| Answer» B. to require the stock exchange to amend their by−laws. | |
| 62. |
SEBI signs MoUs with different country’s financial jurisdictions who are not a signatory to the multilateral MoU of International Organization of Securities Commissions (IOSCO). |
| A. | True |
| B. | False |
| C. | all |
| D. | none |
| Answer» B. False | |
| 63. |
Which of the following is the disadvantage of SEBI |
| A. | Ease of Trading |
| B. | Tax saving |
| C. | Money Laundering |
| D. | All of them |
| Answer» A. Ease of Trading | |
| 64. |
The difference between a primary market and a secondary market is |
| A. | primary market is the stock market and secondary market is the market for second hand sale of securities |
| B. | a primary market helps in long-term credit and secondary market offers short-term credit |
| C. | a primary market helps in the issue of new securities those which are offered for the first time and the secondary market is for second hand sale of securities listed on the stock exchange |
| D. | a primary market is the unorganized sector and the secondary market is the organized sector for sale and purchase of securities. |
| Answer» C. a primary market helps in the issue of new securities those which are offered for the first time and the secondary market is for second hand sale of securities listed on the stock exchange | |
| 65. |
The function of a financial system is to |
| A. | establish a link between savers and investors |
| B. | link commercial banks with the Central Bank of a country |
| C. | create regulators for influencing the intermediaries |
| D. | help traders and moneylenders in the capital market |
| Answer» A. establish a link between savers and investors | |
| 66. |
As a part of the capital adequacy requirement, the base minimum capital prescribed by SEBI: |
| A. | varies from exchange to exchange. |
| B. | is based on the recommendations of the Kaul committee. |
| C. | is based on the recommendations of the Justice Bhagwati Committee. |
| D. | is the same across members of all exchanges. |
| Answer» A. varies from exchange to exchange. | |
| 67. |
Primary and secondary markets: |
| A. | Compete with each other |
| B. | Complement each other |
| C. | Function independently |
| D. | Control each other |
| Answer» B. Complement each other | |
| 68. |
Clearing and settlement operations of NSE are carried out by: |
| A. | NSDL |
| B. | NSCCL |
| C. | SBI |
| D. | CDSL |
| Answer» B. NSCCL | |
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