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FINANCIAL AWARENESS 1 TO 60

 1 TO 30 already posted.  reposted to retain question nos for 31 to 60
1.      CIBIL launches _______ for catering to non-individuals viz., Corporate, SMEs and other type of business entities.
a)   Consumer Bureau      b)   Corporate Bureau      c)   Commercial Bureau
d)   Convenience Bureau      e)   None of these

2.      Interest rates being charged by Banks in India has shown______ trend in recent year.
a)   Falling      b)   Rising      c)   Stable      d)   Volatile      e)   None of these

3.      Which of the following NBFC converted itself into a commercial Bank?
a)   Tata Finance      b)   Reliance Capital Trust      c)   Birla Mutual     
d)   Kotak Mahindra       e)   None of these

4.     Which finance company has been given banking licence by RBI recently
a)   Kotak Mahindra      b)   Ashok Leyland & Finance      c)   TVS Finance
d)   Tata Finance     e)   None of these


5.     Commercial Papers :
a)   are sold by the banks for short term purposes
b)   are like coupon bonds which carry fixed interest
c)   can develop a secondary market
d)   None of the above      e)   All of the above

6.     Presently, participants in the call market :
a)   include some NBFIs      b)   borrow and lend at fixed rates
c)   also include primary dealers       d)   None of the above      e)   All of the above

7.     CPs :
a)   were launched in the Indian money market before CDs.
b)   are issued by scheduled commercial banks.
c)   can be bought by banks as well.
d)   None of the above      e)   All of the above

8.     CDs :
a)   cannot be transacted in the secondary market
b)   can be issued only by scheduled banks      c)   are subjected to CRR and SLR
d)   None of the above      e)   All of the above

9.      CDs :
a)   have a lock-in period      b)   have a minimum issue size of Rs.5 lakhs
c)   are mainly issued by corporate companies      d)   None of the above     
e)   All of the above

10.  In recent years :
a)    the 364-day bill has been the most popular    
b)   the 182-day bill has been the most popular
c)   the 91-day bill has been the most popular      d)   None of the above     
e)   All of the above

11.  Year-end implicit yield :
a)   of all TBs are very similar      b)   of TBs very greatly across different maturity
c)   of TBs do not have much difference      d)   None of the above     
e)   All of the above

12.   The RBI repo market :
a)   will not exist if there are no CRR or SLR obligations of banks.
b)   is complementary to the inter-bank call market.
c)   transacts various types of securities other than government securities
d)   None of the above      e)   All of the above

13.   The LAF Repo market always has :
a)   the Repo rate higher than the R-Repo rate
b)   the R-Repo rate higher than the Repo rate
c)   both are equal      d)   None of the above      e)   All of the above

14.  Which among the following was set up by RBI in 1988 jointly with public sector banks and all India Financial Institutions to develop the money market & provide liquidity to money market instruments as sequel to Vaghul Working Group recommendations?
a)   Discount and Finance House of India Ltd (DFHI)
b)   Central Depository Services (India) Limited (CDSL)
c)   Financial Intelligence Unit India (FIU-IND)
d)   None of these      e)   All of these

15.  Which among the following correctly defines Hundi?
a)   They are slips on paper presented to the customer while purchasing goods
b)   They are accounts of unorganized sector in India
c)   They are key instruments of credit in the unorganized money market in India
d)   None of these      e)   All of these

16.  Recently we came to know that Treasury Bills which are short term (up to one year) borrowing instruments of the Government of India are also being issued frequently under the Market Stabilization Scheme (MSS). They are available for minimum amount of ……?
a)   Rs.25000      b)   Rs.40000      c)   Rs.50000      d)   None of these     
e)   All of the these

17.  Which among the following helps RBI to manage liquidity conditions in the economy with banks having an avenue to surplus funds or avail funds?
a)   Repos      b)   Reverse repos      c)   Money market Mutual Funds
d)   None of these      e)   All of these

18.  Which among the following sentence is true?
a)   RBI introduced Repos & Reverse Repos in 1992
b)   RBI introduced Repos in 1992 & Reverse Repos in 1996
c)   RBI Introduced Repos & Reverse Repos in 1996
d)   None of these      e)   All of these

19.   As we know that RBI has two departments Issue Department and Banking Department. Which among them is responsible for maintaining a Minimum reserve system against printing of currency notes?
a)   Issue Department     b)   Banking Department      c)   Both of them
d)   None of these      e)   All of these

20.   What is the main function of banking department of Reserve Bank of India?
a)   To do banking business with customers  
b)   To provide liquidity to the economy and absorb liquidity
c)   To issue the currency in circulation and its withdrawal from circulation
d)   None of these      e)   All of these

21.   Which among the following is correct regarding “Progressive tax”?
a)   surcharge levied on taxes for development works
b)   rate of tax increased for increased value or volume
c)   getting burden of tax passed on to general customers
d)   None of these      e)   All of these

22.   Which among the following coined the term “Second generation Reforms”?
a)   World Bank      b)   International Monetary Fund      c)   Reserve Bank of India
d)   None of these      e)   All of these

23.  Which among the following is world’s largest foreign exchange market?
a)   New York      b)   London      c)   Tokyo      d)   None of these      e)   All of these
24.    What is REPO rate:
a)   It is a rate at which RBI sells Govt. securities to banks
b)   It is a rate at which bank borrows from RBI
c)   It is a rate at which RBI allows small loans in the market
d)   None of these      e)   All of these

25.  Which of the following cannot be called as a debt instrument as referred in financial transactions.
a)   Certificate of deposits      b)   Bonds      c)   Stocks      d)   Commercial papers
e)   None of these 

26.  Whenever RBI does some open market operation transaction, actually it wishes to regulate which of the following
a)   Inflation Only      b)   Liquidity in economy
c)   Borrowing powers of the bank
d)   Flow of foreign direct investment      e)   None of these

27.   What is call money?
a)   Money borrowed or lent for a day or over night
b)   Money borrowed for more than one day but upto 3 days
c)   Money borrowed for more than one day but upto 14 days
d)   None of these      e)   All of these

28.   Which of the following is not considered as a money market instrument
a)   Treasury bills      b)   Repurchase agreements      c)   Commercial paper
d)   Shares and Bonds      e)   None of these

29.   While discussing investments, there is a mention of short term Government security. What is this investment?
a)   Debenture      b)   Mutual Fund      c)   Treasury bill      d)   Share     
e)   None of these

30.  Which of the following tool is used by RBI to control credit and monetary situations of the markets?
a)   RTGS      b)   NEFT      c)   ECS      d)   CRR     e)   None of these

31.  Reverse Repo rate has the following characteristic.
a)   Borrowing by RBI from banks
b)   Borrowing with Government security as collateral
c)   Short term borrowing      d)   All of these      e)   None of these

32.   The following is the mechanism of injecting liquidity by RBI to the financial system.
a)   Reverse Repo      b)   Hike in CRR      c)   Hike in interest rate      d)   Repo
e)   None of these


33.   What is MSF?
a)   Marginal standing facility      b)   Micro and small finance     
c)   Medium size finance      d)   Mid-term sanction facility      e)   None of these

34.   Which one of the following is not a money market instrument
a)    Repo      b)   Negotiable certificate of deposit      c)   Commercial paper
d)   Treasury bill      e)   None of these

35.   Which of the following is not a part of India’s money market
a)   Bill market      b)   Call money market      c)   Banks      d)   Indian gold council
e)   None of these

36.   What is the full form of CRR as used in banking sector?
a)   Crucial reserve rate      b)   Credit & Reserve ration      c)   Cash reserve ratio
d)   Compulsory return rate      e)   None of these

37.   _____________ is money denominated in the currency of another nation or group of nations.
a)   Foreign exchange      b)   Subsidies      c)   Tariffs      d)   Quotas    
e)   None of these

38.   The market in which foreign exchange transactions take place is called:
a)   The World bank      b)   The foreign exchange market      c)   The federal reserve
d)   The United Nations      e)   None of these

39.   A(n) ________ is the number of units of one currency that buys one unit of another currency, and this number can change daily.
a)   subsidy      b)   tariff      c)  quota      d)   exchange rate     e)   None of these

40.   _______ involve the exchange of currency the second day after the date on which the two foreign exchange traders agree to the transaction.
a)   Spot transactions      b)   Outright forward transactions      c)   FX swaps
d)   Reverse transactions      e)   None of these

41.   Outright forward transactions involve the exchange of currency beyond three days at a fixed exchange rate, known as the :
a)   spot rate      b)   forward rate      c)   FX swap rate      d)   reverse transaction rate
e)   None of these

42.   The single purchase or sale of a currency for future delivery is called:
a)   spot transactions      b)   FX swaps      c)   outright forward transactions
d)   reverse transactions      e)   None of these

43.    The ________ is the most widely traded currency in the world.
a)   peso      b)   yen      c)   Deutsche mark      d)   U.S.dollar      e)   None of these

44.   Which of the following is FALSE regarding the U.S. dollar? The U.S. dollar is :
a)   the third most widely traded currency in the world
b)   a reserve currency held by many central banks
c)   a transaction currency in many international commodity markets.
d)   an invoice currency in many contracts

45.    Which of the following is NOT one of the four largest centres for foreign exchange trading?
a)   the United Kingdom      b)   the United States      c)   Japan      d)   China
e)   None of these

46.  The ________ is the price at which the trader is willing to buy foreign currency.
a)   offer      b)   bid      c)   spread      d)   cross rate      e)   None of these

47.   Which of the following is the price at which the trader is willing to sell foreign currency?
a)   bid      b)   spread      c)   offer      d)   cross rate      e)   None of these

48.   In the spot market, the _________ is the difference between the bid and offer rates and is the trader’s profit margin.
a)  bid      b)   offer      c)   cross rate      d)   spread      e)   None of these

49.   The relationship between two non-dollar currencies is known as the :
a)   cross rate      b)   spot rate      c)   forward rate      d)   backward rate     
e)   None of these

50.  The _______ is the rate quoted for transactions that call for delivery after two business days.
a)   spot rate      b)   forward rate     c)   backward rate      d)   cross rate
e)   None of these

51.   In the spot market, the ________ is the difference between the spot and forward rate.
a)   bid      b)   offer      c)   spread      d)   cross rate      e)   None of these

52.   If the forward rate for a foreign currency is less than the spot rate, the foreign currency is selling at a :
a)   forward premium      b)   backward discount      c)   backward premium
d)   forward discount      e)   None of these

53.   If the forward rate is greater than the spot rate, the foreign currency is selling at a :
a)   forward premium      b)   backward discount      c)   backward premium
d)   forward discount      e)   None of these



54.   The difference between the spot and forward rates is either the _______ or the _______.
a)   forward discount; reverse premium      b)   forward discount; forward premium
c)   reverse discount; forward premium      d)   reverse discount; reverse premium
e)   None of these

55.   In a _______ system, a government sets different rates for different types of transactions,
a)   variable income      b)   fixed income      c)   bonded rate     
d)   multiple exchange-rate      e)   None of these

56.   Countries with ________ often have very high exchange rate for luxury goods and financial flows, such as dividends.
a)   multiple exchange-rate      b)   variable income      c)   fixed income
d)   bonded rate      e)   None of these

57.   The government determines which kinds of transactions are to be conducted at which exchange rates in which of the following systems?
a)   single exchange rate system      b)   multiple exchange rate system
c)   partial exchange rate system      d)   broad exchange rate system     
e)   None of these

58.   Most foreign exchange transactions stem from the international departments of commercial banks, which perform all of the following essential financial functions EXCEPT:
a)   buy and sell foreign exchange      
b)   collect and pay money in transactions with foreign buyers and sellers
c)   raise interest rates among selected companies
d)   lend money in foreign currency      e)   None of these

59.   The most obvious reason companies use the foreign-exchange market is for:
a)   divestment      b)   subsidies      c)   privatization     
d)   import and export transactions      e)   None of these

60.   Companies use the foreign-exchange market for all of the following reasons EXCEPT:
a)   government privatization      b)   import transactions      c)   export transactions

d)   financial transactions, such as those in FDI      e)   None of these
FINANCIAL AWARENESS 1 TO 60 Reviewed by sambasivan srinivasan on 9:43:00 AM Rating: 5

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