Financial Markets And Institutions Set 11
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This set of Financial Markets and Institutions Multiple Choice Questions & Answers (MCQs) focuses on Financial Markets And Institutions Set 11
Q1 | Financial instruments are used
- as a unit of account, as a store of value, and as a means of payment.
- as a unit of account, as a means of payment, and to transfer risk.
- as a store of value, as a means of payment, and to transfer risk.
- as a unit of account, as a store of value, and to transfer risk.
Q2 | Two important characteristics of financial instruments are:
- information communication and risk neutrality.
- risk neutrality and liquidity.
- standardization and information communication.
- liquidity and standardization.
Q3 | Benefits of the merger between the NYSE and Paris-based Euronext, a pan European stock exchange include:
- lower costs and speedier transactions for international financial markets.
- foreign ownership of domestic assets.
- international consolidation of financial services.
- greater the uncertainty.
Q4 | Which of the following increases the value of a financial instrument?
- smaller payments.
- payments made further in the future.
- payments that are made when we need them.
- payments that are less likely to be made.
Q5 | An example of financial instruments that are primarily used as stores of value is:
- insurance contracts.
- home mortgages.
- options.
- futures contracts.
Q6 | Financial markets serve which three purposes?
- Financial markets allow-risk sharing, pool and communicate information, and offer stability.
- Financial markets allow risk sharing, offer stability, and offer liquidity.
- Financial markets offer stability, pool and communicate information, and offer liquidity.
- Financial markets allow-risk sharing, pool and communicate information, and offer liquidity.
Q7 | SEBI operates to fulfill the needs of these three groups, choose the one which is not in those three:
- the issuers of securities
- the police
- the investors
- the market intermediaries
Q8 | SEBI has not been vested with the following powers:
- to approve by−laws of stock exchanges.
- to require the stock exchange to amend their by−laws.
- inspect the books of accounts and call for periodical returns from recognized stock exchanges.
- inspect the books of accounts of financial intermediaries.
Q9 | 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).
- True
- False
- all
- none
Q10 | Which of the following is the disadvantage of SEBI
- Ease of Trading
- Tax saving
- Money Laundering
- All of them
Q11 | The difference between a primary market and a secondary market is
- primary market is the stock market and secondary market is the market for second hand sale of securities
- a primary market helps in long-term credit and secondary market offers short-term credit
- 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
- a primary market is the unorganized sector and the secondary market is the organized sector for sale and purchase of securities.
Q12 | As a part of the capital adequacy requirement, the base minimum capital prescribed by SEBI:
- varies from exchange to exchange.
- is based on the recommendations of the Kaul committee.
- is based on the recommendations of the Justice Bhagwati Committee.
- is the same across members of all exchanges.
Q13 | Primary and secondary markets:
- Compete with each other
- Complement each other
- Function independently
- Control each other
Q14 | Clearing and settlement operations of NSE are carried out by:
- NSDL
- NSCCL
- SBI
- CDSL
Q15 | Which of the following is not a function of SEBI:
- Development of the Securities market
- Investor Protection
- Making the Rules and Regulation for the securities market
- Framing policies for central government operations
Q16 | The function of a financial system is to
- establish a link between savers and investors
- link commercial banks with the Central Bank of a country
- create regulators for influencing the intermediaries
- help traders and moneylenders in the capital market
Q17 | The liquidity status of certificate of deposit which is more negotiable is considered as
- certified liquidity
- term liquidity
- more liquid
- less liquid
Q18 | Which of the following statements about financial markets and securities are true?
- A bond is a long-term security that promises to make periodic payments called dividends to the firm’s residual claimants.
- A debt instrument is intermediate term if its maturity is less than one year.
- A debt instrument is long term if its maturity is ten years or longer.
- The maturity of a debt instrument is the time (term) to that instrument’s expiration date.
Q19 | Which of the following statements about financial markets and securities are true?
- Few common stocks are traded over-the-counter, although the over-the-counter markets have grown in recent years.
- A corporation acquires new funds only when its securities are sold in the primary market.
- Capital market securities are usually more widely traded than longer term securities and so tend to be more liqu
Q20 | At present, the apex institution with regard to rural credit is
- RBI
- NABARD
- ARDC
- SBI
Q21 | Which of the following in India is an exchange bank?
- ICICI bank
- CITI bank
- EXIM bank
- UCO bank
Q22 | Exchange banks specialize in:
- Financing foreign trade
- Promoting foreign investment
- Financing domestic trade
- All the above
Q23 | The IDBI was started in
- 1949
- 1964
- 1982
- 1962
Q24 | The declining profits made banks to undertake the business of:
- Merchant banking
- Mutual funds
- Venture capital
- all of the above
Q25 | Retail banking means granting loans for:
- Construction of houses
- Purchases of consumer durables
- Educational purposes
- All of these