1. ____________ allocates saving efficiently in an economy to ultimate users
either for investment in real assets or for consumption.
Correct : C. Financial system
2. Which of the following is not a regulatory institution in Indian financial system?
Correct : B. CIBIL
3. _____________ is regarded as a queen of Indian financial system.
Correct : B. RBI
4. National Housing bank is a fully owned subsidiary of___________.
Correct : C. RBI
5. Financial institutions are also known as ______________.
Correct : B. Financial intermediaries
6. ____________is the first development financial institution in India.
Correct : C. IFCI
7. IDBI was established in ____________.
Correct : D. 1964
8. ______________is an apex institution to coordinate, supplement and integrate the activities of all
existing specialized financial institutions.
Correct : B. IDBI
9. Which of the following is not an asset held by Commercial Banks?
Correct : B. Current Account Deposits
10. Which of the following combinations is correct?
Correct : C. RRB---------------Agriculture Finance
11. Which of the following is not an organized sector in India?
Correct : D. Chits and Money lenders
12. In which year was the Banking Regulation Act passed?
Correct : A. 1949
13. When did the National Bank of Agriculture and Rural Development establish?
Correct : A. July, 1982
14. Which of the following is the apex institution which handles refinance for agriculture and rural
development in India?
Correct : C. NABARD
15. At which of the following cities is the Head Office of Reserve Bank of India located?
Correct : A. Mumbai
16. “Scheduled bank” in India means a bank _____.
Correct : D. Included in the Second schedule to the Reserve Bank of India Act 1934
17. Which is the largest commercial bank in India?
Correct : C. State Bank of India
18. Co-operative Societies Act was enacted in which year?
Correct : A. 1912
19. With whom does the ownership of Public sector banks rest?
Correct : A. Government of India
20. In which year was the Bank of Maharashtra established?
Correct : B. 1935
21. Urban Cooperative Banks are also called as?
Correct : C. Primary Cooperative Banks
22. What is the full-form of NBFC?
Correct : C. Non-Banking Financial Company
23. Who insures banks in India?
Correct : C. DICGC
24. How many developments banks are there in India?
Correct : B. 6
25. Which of the following is the regulator of Money market?
Correct : A. Reserve Bank of India
26. What is Call Money?
Correct : A. It is an overnight loan in the Money Market
27. What is Notice Money?
Correct : B. It is loan of above1 day to 14 days in the money market
28. What is Term Money?
Correct : C. It is loan of above14 day to 364 days in the money market
29. Which of the following is not related with Money Market?
Correct : D. Shares
30. Which of the following is related with Money Market?
Correct : A. Treasury Bills
31. Which of the following statement is true about Commercial Paper?
Correct : C. It was introduced in 1990
32. Which of the following statement is true about Certificates of Deposits?
Correct : A. It is secure instrument in comparison of Commercial Paper
33. Which of the following statement is false about Treasury Bills?
Correct : D. It is issued maximum for maturity of 1 year
34. Which of the following statement is true about Commercial Bill?
Correct : C. It is a trade Bill
35. Which of the following statement is related to dated Securities?
Correct : D. The date of maturity is mentioned on the certificate
36. What is the minimum amount at which Commercial Paper can be issued?
Correct : A. The minimum amount for Commercial Papers is 5 lakhs.
37. What is the maximum and minimum maturity of Certificate of Deposit issued by financial
Institutions?
Correct : B. Certificate of deposit issued by financial Institutions are for 7 days to 364 days.
38. What is the minimum amount at which Certificate of Deposit can be issued?
Correct : C. The minimum amount for Commercial Papers is 1 lakh.
39. Which of the following is considered to be more secure instrument?
Correct : B. Draft
40. What is the maximum validity of a cheque?
Correct : A. 90 days
41. Which is not a type of cheque?
Correct : D. Promissory Cheque
42. Which is a type of crossing in a cheque?
Correct : B. Special Crossing
43. Which of the following act defines a Cheque?
Correct : B. Negotiable Instrument Act 1881
44. Commercial Bill is a type of_____.
Correct : D. Bill of exchange
45. Which among the following is/are correct regarding Money Market?
Correct : B. Maturity in this market ranging from overnight to one year.
46. Which among the following is/are correct regarding Call Money?
Correct : A. It is the money lent/borrowed for maximum period of 14 days
47. What is the maximum duration for which term money can be lent/borrowed in money market?
Correct : D. 1 year
48. What is the minimum duration for which term money can be lent/borrowed in money market?
Correct : B. 15 days
49. How many Scheduled Commercial Banks are there in India?
Correct : C. 93
50. What is an Indian depository receipt?
Correct : A. A deposit account with a public sector bank.
51. Capital market regulator is:
Correct : D. B S E
52. Which of the following organisations provides a guarantee to the exporters?
Correct : B. Export Credit Guarantee Corporation (E C G C)
53. The financial Market where debt and stocks are traded and maturity period is more than a year is
classified as:
Correct : B. Capital Markets
54. The market in which new Securities are issued by the Corporations to raise funds are called:
Correct : A. Primary Markets
55. Which type of preference Shares can be converted into equity?
Correct : B. Convertible Bonds
56. Which is not one of the development steps taken for Capital Market?
Correct : A. Open Outcry
57. Which of the following is least risky:
Correct : C. Treasury Bills
58. Which security holders will receive arrears of the non- payment of dividends by the Company during
the loss?
Correct : A. Cumulative Preference Share Holders
59. What is the simple example of Stock Index in India:
Correct : B. Sensex
60. The amount which is paid at the time of maturity of the bond is equal to:
Correct : A. Face Value
61. Which one of the following agencies in the Indian Capital market has authority to regulate the Mutual
fund markets in India?
Correct : C. RBI
62. In capital market the major suppliers of trading Instruments are:
Correct : A. Government and corporations
63. In primary markets, the property of shares which made it easy to sell newly issued security is
concerned as:
Correct : A. Increased Liquidity
64. The transaction costs of trading of financial Instruments in centralized market is classified as:
Correct : B. Low transaction Costs
65. In primary market, the first time issued shares to be publicly traded, in stock market is considered as:
Correct : D. Initial Public Offering
66. The exchange markets and over the counter markets are considered as two types of:
Correct : C. Secondary market
67. The bonds that are backed by cash flow from project and are sold to finance particular project are
classified as:
Correct : B. Revenue Bonds
68. The Component of Capital Market are:
Correct : D. All of the above
69. There are ___________ categories of Industrial Security Market.
Correct : B. 2
70. Who controls the capital market in India?
Correct : A. SEBI
71. Which of the following words does not belong to the stock exchange?
Correct : A. KPO
72. Which term most accurately describes selling shares at a higher price than the price at which they were
bought?
Correct : B. Profit
73. How many companies are included in the SENSEX?
Correct : C. 30
74. Which of the following statements is true?
Correct : C. Unit Trust of India was established in 1954
75. Maintaining a foreign currency account is helpful to
Correct : C. Avoid both transaction cost and exchange risk.
76. India’s foreign exchange rate system is?
Correct : B. Managed float
77. Hedging transaction is indicated by
Correct : D. None of the above
78. The acronym SWIFT stands for
Correct : C. Society for Worldwide Interbank Financial Telecommunication.
79. Indirect rate in foreign exchange means
Correct : A. The rate quoted with the units of home currency kept fixed.
80. The exchange rate is
Correct : D. The price of one currency relative to another.
81. India is facing continuous deficit in its balance of payments. In the foreign exchange market rupee is
expected to
Correct : A. Depreciate.
82. The effect of speculation on exchange rate is
Correct : C. Either or both of A and B.
83. The demand for domestic currency in the foreign exchange market is indicated by the following
transactions in balance of payment.
Correct : C. Export of goods and services and capital inflows.
84. If PPP holds
Correct : B. The real exchange rate will not change.
85. A spot transaction in the foreign exchange market involves the
Correct : D. Immediate (within two days) exchange of bank deposits.
86. Forward exchange rates
Correct : B. Involve the exchange of bank deposits at some specified future date.
87. When the value of the British pound changes from $1.50 to $1.25, the pound has ________ and the dollar
has ________.
Correct : B. depreciated; appreciated
88. The foreign exchange market
Correct : D. All of the above.
89. In the long run, ________ affect the exchange rate.
Correct : D. All of the above.
90. Exchange rates are determined in
Correct : B. The foreign exchange market.
91. The immediate (two-day) exchange of one currency for another is a
Correct : B. Spot transaction.
92. An agreement to exchange dollar bank deposits for euro bank deposits in one month is a
Correct : C. Forward transaction.
93. In the foreign exchange market, if the interest rate on foreign deposits increases, holding everything else
constant,
Correct : D. All of the above.
94. Although market trades are said to involve the buying and selling of currencies, most trades involve the
buying and selling of
Correct : A. Bank deposits denominated in different currencies.
95. Higher tariffs and quotas cause a country’s currency to _____ in the _____ run.
Correct : D. appreciate; long
96. Lower tariffs and quotas cause a country’s currency to _____ in the _____ run.
Correct : C. depreciate; long
97. Anything that increases the demand for foreign goods relative to domestic goods tends to _____ the domestic currency because domestic goods will only continue to sell well if the value of the domestic currency is _____.
Correct : A. depreciate; lower
98. If a factor increases the demand for _____ goods relative to _____ goods, the domestic currency will
appreciate.
Correct : D. domestic; foreign
99. An increase in productivity in a country will cause its currency to _____ because it can produce goods at a
_____ price.