MCQOPTIONS
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MCQOPTIONS
This section includes 749 Mcqs, each offering curated multiple-choice questions to sharpen your Master of Arts in Economics (M.A. Economics) knowledge and support exam preparation. Choose a topic below to get started.
| 151. |
Identify the correct sequence of steps to be followed in the trading procedure at Stock Exchange |
| A. | Opening a trading account and Demat account, Placing an order, Settlement of order, Execution of order |
| B. | Settlement of order, Opening a trading account and Demat account, Placing an order, Execution of order |
| C. | Opening a trading account and Demat account, Placing an order, Execution of order, Settlement of order |
| D. | Placing an order, Opening a trading account and Demat account, Execution of order, Settlement of order |
| Answer» D. Placing an order, Opening a trading account and Demat account, Execution of order, Settlement of order | |
| 152. |
Which of the following is not true about the national level exchanges? |
| A. | Offers online trading |
| B. | Recognised on permanent basis |
| C. | Offers single commodity for trading |
| D. | Volumes higher than regional exchanges |
| Answer» D. Volumes higher than regional exchanges | |
| 153. |
Which of the following actions might you expect lenders to take during periods of variable and unpredictable inflation? |
| A. | Reduce the amount of lending they are prepared to do. |
| B. | Increase the average length of loans they are willing to make. |
| C. | Increase the amount of lending they are prepared to do. |
| D. | Reduce the average length of loans they are willing to make. |
| Answer» E. | |
| 154. |
Financial intermediaries |
| A. | exist because there are substantial information and transaction costs in the economy. |
| B. | improve the lot of the small saver. |
| C. | are involved in the process of indirect finance. |
| D. | do all of the above. |
| Answer» E. | |
| 155. |
----------- defined Interest as “an index of the community’s preference for a dollar ofpresent over a dollar of future income.” |
| A. | Fisher |
| B. | Alfred Marshall |
| C. | JM Keynes |
| D. | JB Clark |
| Answer» B. Alfred Marshall | |
| 156. |
.................. are negotiable instrument issued by an overseas depository |
| A. | ADR |
| B. | GDR |
| C. | IDR |
| D. | Any of the above |
| Answer» E. | |
| 157. |
Financial assets are also called: |
| A. | securities. |
| B. | real assets. |
| C. | tangible assets. |
| D. | physical assets. |
| Answer» B. real assets. | |
| 158. |
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-I |
| Answer» B. Central Depository Services (India) Limited (CDSL) | |
| 159. |
SEBI has allowed celebs to endorse which products? |
| A. | Stocks and shares |
| B. | Mutual funds |
| C. | Dividends |
| D. | Insurance |
| Answer» C. Dividends | |
| 160. |
Which among the following coined the term “Second generation Reforms”? |
| A. | World Bank |
| B. | International Monetary Fund |
| C. | Reserve bank of India |
| D. | SBI |
| Answer» C. Reserve bank of India | |
| 161. |
Adverse selection is a problem associated with equity and debt contracts arising from |
| A. | the lender’s relative lack of information about the borrower’s potential returns and risks of his investment activities. |
| B. | the lender’s inability to legally require sufficient collateral to cover a 100 percent loss if the borrower defaults. |
| C. | the borrower’s lack of incentive to seek a loan for highly risky investments. |
| D. | none of the above. |
| Answer» B. the lender’s inability to legally require sufficient collateral to cover a 100 percent loss if the borrower defaults. | |
| 162. |
Hedging through futures contracts |
| A. | increases risk of loss if prices fall |
| B. | eliminates profit maximization potential |
| C. | is considered to be speculative in nature |
| D. | all of the above |
| Answer» C. is considered to be speculative in nature | |
| 163. |
Usance bills are also known as |
| A. | Time bills |
| B. | Sight bills |
| C. | Kite bills |
| D. | Wind bills |
| Answer» B. Sight bills | |
| 164. |
----------can only trade through their account or on account of their clients and however cleartheir trade through PCMs/STCMs. |
| A. | Trading cum Clearing Member |
| B. | Trading Member |
| C. | Commodity Participant |
| D. | Associate Member |
| Answer» C. Commodity Participant | |
| 165. |
The bulk of the nation's money supply is created within the private banking system and is sometimes called: |
| A. | inside money |
| B. | net money |
| C. | base money |
| D. | outside money |
| Answer» C. base money | |
| 166. |
Headquarters of Multi Commodity Exchange in India (MCX) is ---------- |
| A. | New Delhi |
| B. | Ahmedabad |
| C. | Mumbai |
| D. | Calcutta |
| Answer» D. Calcutta | |
| 167. |
Which of the following participants represent capital market? |
| A. | Development banks |
| B. | Commercial banks |
| C. | Stock exchanges |
| D. | All of the above |
| Answer» E. | |
| 168. |
Which of the following occurs four trading days before the date of record? |
| A. | Distribution date. |
| B. | Payment date. |
| C. | Declaration date. |
| D. | Ex-dividend date. |
| Answer» E. | |
| 169. |
Which of the following is a residual claim on a firm’s assets? |
| A. | Preferred stock. |
| B. | Common stock. |
| C. | Preference shares. |
| D. | Participating preferred stock. |
| Answer» C. Preference shares. | |
| 170. |
In the case of certain commodities like gold and silver, delivery is staggered over last ------ days of the contract. |
| A. | Two |
| B. | Three |
| C. | Five |
| D. | Thirteen |
| Answer» D. Thirteen | |
| 171. |
In primary markets, property of shares which made it easy to sell newly issued security isconsidered as |
| A. | increased liquidity |
| B. | decreased liquidity |
| C. | money flow |
| D. | large funds |
| Answer» B. decreased liquidity | |
| 172. |
The presence of transaction costs in financial markets explains, in part, why |
| A. | financial intermediaries and indirect finance play such an important role in financial markets. |
| B. | equity and bond financing play such an important role in financial markets. |
| C. | corporations get more funds through equity financing than they get from financial intermediaries. |
| D. | direct financing is more important than indirect financing as a source of funds. |
| Answer» B. equity and bond financing play such an important role in financial markets. | |
| 173. |
It is an instrument of short-term borrowing by the Government of India maturing in lessthan one year. |
| A. | Commercial bill |
| B. | Treasury bill |
| C. | Call money |
| D. | None of the above |
| Answer» D. None of the above | |
| 174. |
Technical consultancy Organisations were set up by........................ |
| A. | IFCI |
| B. | IDBI |
| C. | RBI |
| D. | SEBI |
| Answer» C. RBI | |
| 175. |
A person appointed by a stock broker to assist to him in the business of securities trading attrading floor of stock exchanges is |
| A. | Sub-broker |
| B. | Commission broker |
| C. | Authorised clerk |
| D. | Remisiers |
| Answer» D. Remisiers | |
| 176. |
If savers decide to save more, ceteris paribus, the loanable funds theory predicts: |
| A. | A reduction in investment and interest rates |
| B. | An increase in investment and interest rates |
| C. | Higher economic growth |
| D. | A reduction in interest rates and more investment |
| Answer» E. | |
| 177. |
RBI issues currency noted under |
| A. | Minimum reserve system |
| B. | Proportional reserve system |
| C. | Maximum issue system |
| D. | None of the above |
| Answer» B. Proportional reserve system | |
| 178. |
Which of the following statements is not true with regard to money market? |
| A. | It involves low market risk. |
| B. | It is situated at specific locations. |
| C. | Deals in unsecured and short-term debt instruments. |
| D. | The instruments traded are highly liquid. |
| Answer» C. Deals in unsecured and short-term debt instruments. | |
| 179. |
Perpetual bond is also known as |
| A. | Deep discount bond |
| B. | Irredeemable bond |
| C. | Bearer bond |
| D. | Registered bond |
| Answer» C. Bearer bond | |
| 180. |
Secured Premium Notes (SPN) always issued with........... |
| A. | Premium |
| B. | Discount |
| C. | Detachable Warrant |
| D. | Coupon |
| Answer» D. Coupon | |
| 181. |
Investment banking was developed by |
| A. | Japan |
| B. | England |
| C. | USA |
| D. | None of the above |
| Answer» C. USA | |
| 182. |
Which of the following is a money market security? |
| A. | Repurchase agreements. |
| B. | Municipal bonds. |
| C. | Mortgages. |
| D. | U.S. Treasury notes. |
| Answer» B. Municipal bonds. | |
| 183. |
An issuer can launch an IPO within..................... |
| A. | 3 months |
| B. | 6 months |
| C. | 9 months |
| D. | one year |
| Answer» C. 9 months | |
| 184. |
Which of the following are examples of Hundis in india |
| A. | Shah jog |
| B. | Namjog |
| C. | Jokhani |
| D. | All the above |
| Answer» E. | |
| 185. |
Mutual funds are very popular in |
| A. | USA |
| B. | UK |
| C. | Japan |
| D. | India |
| Answer» B. UK | |
| 186. |
An example of financial instruments that are primarily used as stores of value is: |
| A. | insurance contracts. |
| B. | home mortgages. |
| C. | options. |
| D. | futures contracts. |
| Answer» C. options. | |
| 187. |
Financial intermediaries can substantially reduce transaction costs per dollar of transactions because their large size allows them to take advantage of |
| A. | poorly informed consumers. |
| B. | standardization. |
| C. | economies of scale. |
| D. | their market power. |
| Answer» D. their market power. | |
| 188. |
A mutual fund that invests solely in stocks would be categorized as a/an: |
| A. | bond fund |
| B. | fixed income fund |
| C. | money market fund |
| D. | equity fund |
| Answer» C. money market fund | |
| 189. |
Margin requirements on commodities contracts |
| A. | are much higher than those on common stock transactions. |
| B. | vary over time and even among exchanges for a given commodity. |
| C. | typically, are 2 to 10 percent of the value of the contract. |
| D. | none of the above are true. |
| Answer» D. none of the above are true. | |
| 190. |
The type of financial security which have linked payoff to another issued securityis classified as. |
| A. | linked security |
| B. | derivative security |
| C. | payable security |
| D. | non- issuing security |
| Answer» C. payable security | |
| 191. |
..................... is the suitable method where small companies issue shares |
| A. | public issue |
| B. | placement |
| C. | offer for sale |
| D. | none of these |
| Answer» C. offer for sale | |
| 192. |
Coupon bonds: |
| A. | require borrowers to pay the lender coupon payments until maturity, when the borrower pays the principle. |
| B. | require borrowers to pay lenders coupon payments until maturity. |
| C. | require borrowers to pay lenders principle and interest at maturity. |
| D. | require only interest payments until maturity when principle and interest are paid. |
| Answer» B. require borrowers to pay lenders coupon payments until maturity. | |
| 193. |
In indirect finance: |
| A. | lenders loan to borrowers. |
| B. | an institution borrows from the lender and provides funds to the borrower. |
| C. | occurs between a borrower and lender, with or without an intermediary. |
| D. | the borrower is required to have collateral. |
| Answer» C. occurs between a borrower and lender, with or without an intermediary. | |
| 194. |
Exchange banks specialize in: |
| A. | Financing foreign trade |
| B. | Promoting foreign investment |
| C. | Financing domestic trade |
| D. | All the above |
| Answer» B. Promoting foreign investment | |
| 195. |
Secondary markets |
| A. | engage in buying and selling that is out of the public view. |
| B. | are where governments go to finance ongoing operations. |
| C. | include centralized exchanges, over-the-counter markets, and electronic communication networks. |
| D. | include all of the above. |
| Answer» D. include all of the above. | |
| 196. |
It is a method by which banks borrow from each other to be able to maintain the cash reserve ratio. |
| A. | Commercial bill |
| B. | Commercial papers |
| C. | Call money |
| D. | None of the above |
| Answer» C. Call money | |
| 197. |
Most bonds: |
| A. | are money market securities. |
| B. | give bondholders a voice in the affairs of the corporation. |
| C. | are interest-bearing obligations of governments or corporations. |
| D. | are floating-rate securities. |
| Answer» D. are floating-rate securities. | |
| 198. |
__________would encompass fees received by the bank, but not revenues comingfrom interest charges on loans. |
| A. | Net interest margin |
| B. | Spread |
| C. | Non interest income |
| D. | Non interest expense |
| Answer» C. Non interest income | |
| 199. |
PK Enterprises Limited has sold an entire lot of 5,00,000 equity shares @ ₹9 each to Prosperous Bank Private Limited. The bank in turn will offer the shares to general public for subscription @ ₹11 per share. Identify the method of floatation being described in the given lines. |
| A. | Private placement |
| B. | Offer through prospectus |
| C. | Offer for sale |
| D. | Rights issue |
| Answer» D. Rights issue | |
| 200. |
Corporations borrow for the short term by issuing: |
| A. | corporate bills. |
| B. | corporate bonds. |
| C. | commercial paper. |
| D. | bankers’ acceptances. |
| Answer» D. bankers’ acceptances. | |