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This set of Financial Markets and Institutions Multiple Choice Questions & Answers (MCQs) focuses on Financial Markets And Institutions Set 3

Q1 | In what city are the two largest commodities exchanges?
  • Chicago
  • New York
  • Kansas City
  • Minneapolis
Q2 | The financial futures market has evolved over recent time because of
  • volatility and risk in the foreign exchange markets
  • volatility of interest rates
  • appeal to speculators due to low margin requirements
  • all of the above
Q3 | While hedging through interest rate futures reduces or eliminates the risk of loss, it also
  • is illegal in some cases.
  • has not been accepted by most corporate financial managers.
  • eliminates the possibility of an abnormal gain.
  • none of the above.
Q4 | Margin requirements on commodities contracts
  • are much higher than those on common stock transactions.
  • vary over time and even among exchanges for a given commodity.
  • typically, are 2 to 10 percent of the value of the contract.
  • none of the above are true.
Q5 | Which of the following can be the underlying for a commodity derivative contract?
  • Interest Rate
  • Euro-Indian Rupee
  • Gold
  • NIFTY
Q6 | Daily mark to market settlement is done ------------
  • Till the date of contract expiry
  • As long as the contract makes a loss
  • On the last day of week
  • On the last trading day of the month
Q7 | ----------is the actual process of exchanging money and goods.
  • Transfer
  • Settlement
  • Netting
  • Clearing
Q8 | -----------work at making profits by taking advantage of discrepancy between prices of thesame product across different markets.
  • Arbitragers
  • Speculators
  • Exchange
  • Hedgers
Q9 | Commodity exchanges enable producers and consumer to hedge their -----------given theuncertainty of the future.
  • seasonal risk
  • profit risk
  • production risk
  • price risk
Q10 | Which of the following is not true about the national level exchanges?
  • Offers online trading
  • Recognised on permanent basis
  • Offers single commodity for trading
  • Volumes higher than regional exchanges
Q11 | ----------- Exchanges provide real time, online, transparent and vibrant spot platform forcommodities.
  • Electronic Spot
  • Regional
  • Futures
  • Stock
Q12 | ----------can only trade through their account or on account of their clients and however cleartheir trade through PCMs/STCMs.
  • Trading cum Clearing Member
  • Trading Member
  • Commodity Participant
  • Associate Member
Q13 | The minimum net worth requirement for PCM on the NCDEX is-----------.
  • 50 Lakh
  • 500 Lakh
  • 5000 Lakh
  • 5 Lakh
Q14 | Members of commodity market can opt to meet the security deposit requirement by way of -----------
  • Cash
  • Bank Guarantee
  • Fixed Deposit Receipts
  • All of the above
Q15 | In the case of certain commodities like gold and silver, delivery is staggered over last ------ days of the contract.
  • Two
  • Three
  • Five
  • Thirteen
Q16 | Unit of trading for Wheat at NCDEX is---------
  • 1 MT
  • 3 MT
  • 1 kg
  • 10 MT
Q17 | At present how many national commodity exchanges are operating in India?
  • 8
  • 7
  • 6
  • 10
Q18 | Regulatory body of commodity market in India is-------------
  • FMC
  • NCX
  • ICE
  • ICRA
Q19 | Forward Market Commission (FMC) established in the year-----------
  • 1948
  • 1964
  • 1953
  • 1952
Q20 | FMC merged with SEBI in the year------------
  • 1994
  • 2008
  • 2015
  • 2016
Q21 | The year of establishment of National Multi- Commodity Exchange (NMCE) was---------
  • 2002
  • 2003
  • 2004
  • 2005
Q22 | The Headquarters of NMCE is -------------
  • New Delhi
  • Ahmedabad
  • Mumbai
  • Calcutta
Q23 | -----------is the world’s largest exchange in silver and gold
  • NMCE
  • MCX
  • ICEX
  • NCDEX
Q24 | ---------------holds 86% market share of commodity exchange in India
  • NMCE
  • MCX
  • ICEX
  • NCDEX
Q25 | Headquarters of Multi Commodity Exchange in India (MCX) is ----------
  • New Delhi
  • Ahmedabad
  • Mumbai
  • Calcutta