MCQOPTIONS
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MCQOPTIONS
This section includes 173 Mcqs, each offering curated multiple-choice questions to sharpen your Mutual Fund Management knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
……………. is a facility provided by banks to investors in new fund offers (NFOs) of mutual funds. |
| A. | ASBA |
| B. | CASBA |
| C. | MASBA |
| D. | NASA |
| Answer» B. CASBA | |
| 2. |
If a mutual fund NAV Is 50 and its expense ratio is 2% what are the total expenses per share? |
| A. | 2 |
| B. | 10 |
| C. | 1 |
| D. | 5 |
| Answer» D. 5 | |
| 3. |
In …………….. STP investor transfers the profit from one fund and invests in the other. |
| A. | Flexi |
| B. | Capital Appreciation |
| C. | Fixed |
| D. | Net |
| Answer» C. Fixed | |
| 4. |
The component of the expense ratio that includes a fee charged by some mutual funds to pay brokers is |
| A. | A management fee |
| B. | A 12b-1 fee |
| C. | An administrative expense. |
| D. | A referral fee. |
| Answer» C. An administrative expense. | |
| 5. |
______ funds are mutual funds that attempt to mirror the movements of the existing board marketindicators. |
| A. | Internet |
| B. | Stock |
| C. | Index |
| D. | International |
| Answer» D. International | |
| 6. |
which of the following is a stock mutual fund? |
| A. | Ginnie Mae fund |
| B. | Growth fund |
| C. | Municipal securities fund |
| D. | Treasury securities find |
| Answer» C. Municipal securities fund | |
| 7. |
You invested 1,000 in a mutual fund with a 4% load when NAV was 20 per share. If you sell your sharesat a NAV of 20 per share, what is the return of your investment? |
| A. | 14.8% |
| B. | 15.2% |
| C. | 12.5% |
| D. | 10.8% |
| Answer» C. 12.5% | |
| 8. |
On average, actively managed mutual funds have an expenses ratio of about |
| A. | 1.5% |
| B. | 2.5% |
| C. | 3% |
| D. | 5%. |
| Answer» B. 2.5% | |
| 9. |
A scheme has average weekly net assets of Rs. 324 Cr and has annual expenses of Rs 3.24Cr, it'sexpenses ratio is |
| A. | 1% |
| B. | 10% |
| C. | Can't say |
| D. | Insufficient information |
| Answer» B. 10% | |
| 10. |
For a scheme to be defined as an equal fund, it must have a minimum |
| A. | 65% in Indian equities |
| B. | 65% in equities |
| C. | 51% Indian equities |
| D. | 35% in Indian equities |
| Answer» C. 51% Indian equities | |
| 11. |
Investors in high tax brackets will normally achieve higher performance by selecting a mutualfund that generates |
| A. | long-term dividends |
| B. | long-term capital gains |
| C. | long-term stock dividends |
| D. | short-term capital gains |
| Answer» C. long-term stock dividends | |
| 12. |
…………….. allows an investor to withdraw a fixed amount of money periodically. |
| A. | SIP |
| B. | SWP |
| C. | STP |
| D. | SRT |
| Answer» C. STP | |
| 13. |
Regarding load and no-load mutual funds, |
| A. | Load funds usually outperform no-load funds |
| B. | no-load funds perform at least as well as load funds even fees are ignored. |
| C. | Two types of fund perform about the same considering the fees |
| D. | Load funds may be bought directly, whereas no-load funds must be purchased through a broker. |
| Answer» C. Two types of fund perform about the same considering the fees | |
| 14. |
Which of the following characteristics is not true of close-ended funds? |
| A. | They can be load or no-load funds. |
| B. | They do not repurchase shares from investors. |
| C. | They are bought and sold on stock exchanges. |
| D. | They may sell above or below NAV. |
| Answer» B. They do not repurchase shares from investors. | |
| 15. |
Which of the following stock mutual fund focus on medium-sized companies that are more establishedthan small-cap firms, but may have less growth potential? |
| A. | Equity income funds |
| B. | Sector funds |
| C. | Mid-size capitalisation funds |
| D. | Balance growth and income funds |
| Answer» D. Balance growth and income funds | |
| 16. |
If a scheme has 45Cr units issued and has an FV of Rs. 10 and NAV is at 11.33, unitcapital(Rs.Cr) would be equal to |
| A. | 500.85 |
| B. | 50.85 |
| C. | 950.85 |
| D. | 450 |
| Answer» C. 950.85 | |
| 17. |
A mutual fund has a beginning balance of 100 million earns interest of 10 million, receives dividends of15 million, and has expenses of 5 million. If 10 million shares are outstanding, what is the NAV? |
| A. | 10.50 |
| B. | 11.00 |
| C. | 12.00 |
| D. | 12.50 |
| Answer» D. 12.50 | |
| 18. |
Index funds offer tax advantages because they ______ In much trading and, therefore, _______ capitalgains. |
| A. | engage; generate |
| B. | do not engage; generate |
| C. | engage; do not generate |
| D. | do not engage; do not generate |
| Answer» E. | |
| 19. |
What would be the tax consequence of owning a mutual fund that made distributions of 600resulting from short-term capital gains and $800 resulting from long-term capital gain rate? |
| A. | 420 |
| B. | 140 |
| C. | 300 |
| D. | 260 |
| Answer» E. | |
| 20. |
How much money would you need to purchase 400 shares of a mutual fund with a NAV of$55 per share and a 3% load? |
| A. | $22,000 |
| B. | $21,450 |
| C. | $23,200 |
| D. | $22,660 |
| Answer» E. | |
| 21. |
A ……………… ended scheme shall be wound upon the expiry of duration fixed in the scheme on theredemption of units. |
| A. | Open |
| B. | close |
| C. | Old |
| D. | New |
| Answer» C. Old | |
| 22. |
____________ are an important link between fund managers and investors. |
| A. | Trustee |
| B. | Asset Management Company |
| C. | Custodian |
| D. | Registrar And Transfer Agents |
| Answer» E. | |
| 23. |
SIP stands for ______________. |
| A. | Systematic investment plan |
| B. | Simple investment plan |
| C. | Simplified investment programme |
| D. | Single investment plan |
| Answer» B. Simple investment plan | |
| 24. |
The susceptibility of a mutual fund’s performance to general stock market conditions is known as |
| A. | Interest rate risk |
| B. | Market risk |
| C. | Exchange risk |
| D. | Corporate risk |
| Answer» C. Exchange risk | |
| 25. |
Mutual funds are constituted in India as ____________. |
| A. | Trust |
| B. | Limited liability partnership |
| C. | Companies |
| D. | Non-Government organisations |
| Answer» B. Limited liability partnership | |
| 26. |
Transaction cost is ………… with investment in Mutual Funds. |
| A. | high |
| B. | low |
| C. | very high |
| D. | Nil |
| Answer» C. very high | |
| 27. |
An investor pays a tax on the dividend that he receives from a mutual fund scheme at |
| A. | 10% |
| B. | 20% |
| C. | 30% |
| D. | Tax is not applicable |
| Answer» B. 20% | |
| 28. |
The _________ is the market value of the securities that mutual funds have purchased minus anyliabilities per unit. |
| A. | Net asset value |
| B. | Book value |
| C. | Gross asset value |
| D. | Net worth value |
| Answer» B. Book value | |
| 29. |
A mutual fund is a ……………intermediary (like a trust) regulated in India by the SEBI. |
| A. | financial |
| B. | professional |
| C. | physical |
| D. | Mental |
| Answer» B. professional | |
| 30. |
SIP is a _______________. |
| A. | Method of regular investment |
| B. | Name of a mutual fund |
| C. | Brand of a tea stock |
| D. | Method of one time investment |
| Answer» B. Name of a mutual fund | |
| 31. |
Day to day operations of a mutual fund is handled by |
| A. | Asset Management Company |
| B. | Sponsor |
| C. | Trustee |
| D. | Shareholders |
| Answer» C. Trustee | |
| 32. |
A Mutual fund is owned by _____________. |
| A. | SEBI |
| B. | The Government of India |
| C. | AMFI |
| D. | All its investors |
| Answer» E. | |
| 33. |
Investors can enter and exit under _______ at any time |
| A. | Fixed maturity plan |
| B. | Open-Ended Funds |
| C. | Close-Ended Funds |
| D. | Interval fund |
| Answer» C. Close-Ended Funds | |
| 34. |
The NAV of each scheme should be updated on AMFI's website |
| A. | Every Day |
| B. | Every month |
| C. | Every hour |
| D. | Every quarter |
| Answer» B. Every month | |
| 35. |
Which of the following banks launched the first mutual fund in India? |
| A. | SBI |
| B. | Canara Bank |
| C. | Bank of India |
| D. | Indian Bank |
| Answer» B. Canara Bank | |
| 36. |
In ____________ funds, the money is invested primarily in short-term or very short-terminstruments e.g. T-Bills, CPs etc. |
| A. | Growth fund |
| B. | Income funds |
| C. | Liquid funds |
| D. | Tax-Saving Funds (ELSS) |
| Answer» D. Tax-Saving Funds (ELSS) | |
| 37. |
AMFI was incorporated on ________________. |
| A. | 22nd August 1995 |
| B. | 12th April 1992 |
| C. | 1st April 1935 |
| D. | 15th August 1947 |
| Answer» B. 12th April 1992 | |
| 38. |
Which payment mode is not applicable while purchasing mutual fund scheme? |
| A. | Cheque |
| B. | Demand Draft |
| C. | Cash |
| D. | Pay Order |
| Answer» D. Pay Order | |
| 39. |
Which of the following organizations is the Mutual Fund Market regulator in India? |
| A. | SEBI |
| B. | RBI |
| C. | AMFI |
| D. | CIBIL |
| Answer» D. CIBIL | |
| 40. |
Which type of fund is more volatile? |
| A. | Large-cap fund |
| B. | Mid-cap funds |
| C. | Small-cap funds |
| D. | Hybrid Funds |
| Answer» B. Mid-cap funds | |
| 41. |
………………… helps to improve the risk return relationship. |
| A. | Diversification |
| B. | Liquidity |
| C. | Professional Management |
| D. | tax |
| Answer» B. Liquidity | |
| 42. |
If opening units 25,000 ,Units subscribe 7000, Units redeem 2000 then Closing units? |
| A. | 30,000 units |
| B. | 25,000 units |
| C. | 32,000 units |
| D. | 44,000 units |
| Answer» B. 25,000 units | |
| 43. |
……… is the first time subscription offer for a new scheme launched by the Asset Management Company. |
| A. | FFO |
| B. | CFO |
| C. | IPO |
| D. | NFO |
| Answer» E. | |
| 44. |
Expenses ratio is very important for _____. |
| A. | Debt fund |
| B. | Index fund |
| C. | Equity fund |
| D. | Currency fund |
| Answer» B. Index fund | |
| 45. |
If opening units 10,000 Units subscribe 3000, Units redeem 1000 then Closing units? |
| A. | 10,000 units |
| B. | 13,000 units |
| C. | 12,000 units |
| D. | 14,000 units |
| Answer» D. 14,000 units | |
| 46. |
If opening units 1,25,000 Units subscribe 2,00,000, Units redeem 50,000 then Closing units? |
| A. | 3,25,000 units |
| B. | 2,75,000 units |
| C. | 3,75,000 units |
| D. | 2,50,000 units |
| Answer» C. 3,75,000 units | |
| 47. |
According to Bogle an investor’s exposure to debt investment should be equal to his ___. |
| A. | Sex |
| B. | Age |
| C. | Income |
| D. | Cast |
| Answer» C. Income | |
| 48. |
Closed ended funds were usually trading at _________ to NAV |
| A. | Par |
| B. | Premium |
| C. | Discount |
| D. | Free |
| Answer» D. Free | |
| 49. |
Higher expenses ratios lead to _______. |
| A. | Yield sacrifices |
| B. | Profit |
| C. | Income |
| D. | Wealth |
| Answer» B. Profit | |
| 50. |
If fund is assuming higher risk than the market index, its beta will be ________. |
| A. | Greater than 1 |
| B. | Less than 1 |
| C. | Equal to 1 |
| D. | Equal to 2 |
| Answer» B. Less than 1 | |