190
95.4k
Chapter:

20+ Unit 4 Solved MCQs

in Financial Markets and Institutions

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

Take a Test
Chapter: Unit 4
1.

The largest industry group receiving venture capital funding is

A. computer software.
B. medical/health.
C. computer hardware.
D. none of the above.
Answer» D. none of the above.
discuss
2.

The source of venture capital funding has

A. shifted from wealthy individuals to pension funds and corporations.
B. shifted from pension funds and corporations to wealthy individuals.
C. decreased since 1990.
D. none of the above.
Answer» A. shifted from wealthy individuals to pension funds and corporations.
discuss
3.

A typical venture capital firm has a ______ number of investors who each contribute a ______ amount of money to the fund.

A. large; small
B. small; large
C. large; large
D. small; small
Answer» B. small; large
discuss
4.

Most automobile financing is provided by

A. commercial banks.
B. thrifts.
C. finance companies owned by automobile companies.
D. finance companies owned by real estate brokers.
Answer» C. finance companies owned by automobile companies.
discuss
5.

Business finance companies provide specialized forms of credit to businesses by making loans and purchasing accounts receivable at a discount; this provision of credit is called

A. discounting.
B. factoring.
C. refinancing
D. sparking.
Answer» B. factoring.
discuss
6.

Which one of the following is a regarded as classic venture capital?

A. MBO finance
B. Early stage
C. Institutional
D. Corporate
Answer» B. Early stage
discuss
7.

Which agency regulates and supervises NBFCs?

A. Finance Ministry
B. SEBI
C. RBI
D. Respective state government
Answer» C. RBI
discuss
8.

Which of the following statements is/are correct? 1. NBFCs does not hold a banking license. 2. NBFC can issue Demand Drafts like banks.

A. Only 1
B. Only 2
C. Both
D. None
Answer» A. Only 1
discuss
9.

Consider the following statements 1. Chit Funds are type of NBFC 2. All NBFCs are ruled by RBI 3. RBI said any purchase of a stake of 26% or more in a company, or a change in more than 30% of its directors, would need the central bank's permission. Which of the above statements is/are correct?

A. 1,2
B. 2,3
C. 1,3
D. All
Answer» C. 1,3
discuss
10.

Which of the following NBFC converted itself into a commercial Bank?

A. Tata Finance
B. Reliance Capital Trust
C. Birla Mutual
D. Kotak Mahindra
Answer» D. Kotak Mahindra
discuss
11.

Indian Banks Association (IBA) has a common networking system for sharing the ATM facilities in Mumbai, which is known as

A. ATM Network
B. Shared Payment Network System
C. Cash Network
D. None of these
Answer» B. Shared Payment Network System
discuss
12.

Markets in which derivatives are traded are classified as

A. assets backed market
B. cash flow backed markets
C. mortgage backed markets
D. derivative securities markets
Answer» D. derivative securities markets
discuss
13.

Consider buying of put option, probability that a buyer would have negative payoff increases with the

A. increase in stock price
B. decrease in stock price
C. increase in maturity duration
D. decrease in maturity duration
Answer» A. increase in stock price
discuss
14.

Price of an option is subtracted form time value of option to calculate

A. book value index
B. market index
C. intrinsic value
D. extrinsic value
Answer» C. intrinsic value
discuss
15.

If intrinsic value of an option is $450 and price of an option is $560 then time value of an option is

A. $110
B. $1,010
C. $450.00
D. $560
Answer» A. $110
discuss
16.

Type of swaps in which fixed payments of interest are exchanged by two counterparties for floating payments of interest are called

A. float-fixed swaps
B. interest rate swaps
C. indexed swaps
D. counter party swaps
Answer» B. interest rate swaps
discuss
17.

Type of bonds that pay coupon interest are classified as

A. forward bond
B. payment bonds
C. coupon bond
D. interest bonds
Answer» C. coupon bond
discuss
18.

For given change in interest rates, percentage change in present value of bond is classified as

A. price sensitivity
B. yield sensitivity
C. maturity sensitivity
D. premium sensitivity
Answer» A. price sensitivity
discuss
19.

Type of bond whose present value is lesser than that of its face value is classified as

A. discount bond
B. premium bond
C. coupon bond
D. interest bonds
Answer» A. discount bond
discuss
20.

For an investment, weighted average time to maturity is considered as

A. premium time
B. standard time
C. mean time
D. duration
Answer» D. duration
discuss
21.

Bonds that does not pay any interest rate are considered as

A. interest free bond
B. zero coupon bond
C. price less coupon bond
D. useless price bonds
Answer» B. zero coupon bond
discuss
22.

Which of the following is not a characteristic feature of venture capital firms?

A. Funding just one or a small number of firms.
B. Holding equity in the firms that are funded.
C. Having a long-term investment horizon.
D. Providing advice and assistance to the firms that are funded.
Answer» A. Funding just one or a small number of firms.
discuss
23.

Which of the following is a characteristic feature of venture capital firms?

A. Developing a portfolio of companies.
B. Holding debt in the firms that are funded.
C. Allowing firms to use the funds as they see fit.
D. Having a short-term investment horizon.
Answer» A. Developing a portfolio of companies.
discuss

Done Studing? Take A Test.

Great job completing your study session! Now it's time to put your knowledge to the test. Challenge yourself, see how much you've learned, and identify areas for improvement. Don’t worry, this is all part of the journey to mastery. Ready for the next step? Take a quiz to solidify what you've just studied.

Take a Test