Professional Documents
Culture Documents
25. Loan Syndication also enables the members of the syndicate to share the credit
------------ associated with a particular loan among them. ( )
1) Risk 2) Hazard 3) Peril 4) Uncertainty 5) All of the above
26. ________________ is an active member in the B S F. ( )
1) Tarawani wala 2) Share Khan 3) Motilal oswal 4) India
5) None of the above
27. A _______is an independent broker who deals in securities on his own behalf. ( )
1) Jobber 2) Tarwani wala 3)Arbitrager 4)Speculator 5)All of the above
28. No broker is allowed to under write more than -------- of public issues. ( )
1) 7% 2)12% 3) 5% 4) 3% 5) None of the above
29.__________________ for brokers and sub brokers is made mandatory. ( )
1) Registration 2) Listing 3)Both 4)Clearing and settlement
5) None
30. ____________ is a well diversified 50 stock index accounting for 25 sectors. ( )
1) S & P CNX Nifty 2) Sensex 3) BT 500 4)All of the above 5)None
31. ________ is a number that helps measure the levels of the market. ( )
1) Stock Index 2) Portfolio 3)Market return 4)All 5)None of the above
32. _____Committee was appointed to evaluate the Introduction of Derivative. ( )
1) Dr L C Gupta 2) Narsimham committee 3) R L Gupta 4) All of the above
5) None
33. ___________ Provide for the delivery of the contracted Assets. ( )
1) Futures 2) Forwards 3)Options 4)Swaps 5)None of the above
34. Short Selling is an act of _______________without owning them.
1) selling shares 2) Purchasing shares 3) Trading 4)Buying back
5) None of the above
35. Rolling Settlement starts with __________
1) S E B I 2)R B I 3) Ministry of Finance 4)All of the above
5)None of the above
36. ________ should be maintained by member brokers of all stock exchanges.
1) A Minimum deposit 2) No Fees 3) 5 crores 4) 10 crores
5) All of the above
37. ________ had started its own price index.
1)The Bombay Stock Exchange 2) National Stock Exchange 3) O.T.C.E.I
4) Regional Stock Exchange 5) None of the above
38._____is a contract which gives the right but not the obligation to buy or sell a security.
1) Option 2)Forward 3) Future 4)SWAP 5)All of the above
39. ________contract is an agreement to exchange an asset for cash at a future date.
1) Forward 2)Option 3)Future 4) SWAP 5) None of the above
40. __________ is a speculative sale without having the security to deliver.
1) Short Selling 2) Purchasing shares 3)Trading 4) Buying back
5) All of the above
41. _____ is a fund raised by a financial company by pooling the savings of the public.
1) Mutual fund 2) Asset Management 3)Liability Management 4)None
5) Bill discounting
42. ____________ provide a wide range of activities such as issue management PM.
1) Merchant Bankers 2) Financial Institutions 3)Intermediaries
4) All of the above 5) None of the above
43. ___________Service is useful to Investor in formulating investment strategies.
1) Credit Rating 2) Factoring 3) Forfeiting 4)All of the above
5) None of the above
44. ____________ was prescribed a code of conduct to the merchant bankers.
1) S E B I 2)R B I 3)Ministry of finance 4)All of the above
5) None of the above
45. _____________ was made mandatory for some issues.
1) Credit Rating 2) Factoring 3)Forfeiting 4)All of the above
5) None of the above
46. ___________were set up during the last decade.
1) New Mutual funds 2) New Fund Offers 3) Public Issues
4) All of the above 5) None of the above
47. ___is a company which has not completed twelve months of Commercial Production.
1) New Company 2) Recent Incorporation 3)Prior to incorporation
4) All of the above 5) None of the above
48. ________________ Method of pricing securities a becoming popular in India
1) Book Building 2) Net Asset Value 3) Market Value 4)Demand for the share
5) All of the above
49. _____________is a method of raising funds in the market by an existing company.
1) Rights Issue 2) New Issue 3) Bonus Issue 4)All of the above
5) None of the above
50. The following is a kind of fee based activity of a financial intermediary.
1) Hire Purchase 2) Leasing 3) Capital Issue management
4)Underwriting 5) None of the above
3. The holder of B/E can _________________ the B/E up to the date of maturity or before the date
of maturity. ( )
1) Hold or discount 2) transfer 3) deliver 4) Issue 5) All of the above
28. Merchant bank is an organization that ------------------- corporate securities, provides advisory
services to its clients. ( )
1) Undertaken 2) Underwrites 3) Unify 4)All of the above
5) None of the above
29. The Activity of merchant bankers which facilitate issue process is termed as -----( )
1) Merchant banking 2) Investment Banking 3)Modern Banking
4) Mortgage Banking 5) All of the above
30. A merchant banking company has been exempted from the provisions of Section 45-IA , Section
45-IB and 45-IC of the ---------------- Act, 1934. ( )
1) RBI 2) SEBI 3)IT 4)a& b 5) None of the above
31. It is registered with the Securities and Exchange Board of India as a Merchant Banker under
Section ----------- of the Securities and Exchange Board of India Act, 1992. ( )
1) 10 2) 11 3)12 4) 13 5)All of the above
32. ---------- is carrying on the business in accordance with the Securities and Exchange Board of
India Merchant Banking (Rules) 1992. ( )
1) Commercial Banking 2) Investment Banking 3)Merchant Banking
4) b&c 5) None of the above
33. Merchant Bank does not accept or hold --------- deposits as defined in paragraph 2(1)(xii) of the
Notification No. DFC 118/DG(SPT)-98 dated January 31, 1998. ( )
1) Private 2) Public 3) Recurring 4) Fixed
5) All of the above
34. Registration with SEBI is --- to carry out the business of merchant banking in India. ( )
1) Optional 2) Mandatory 3) Not required 4) Up to RBI
5) None of the above
35. An applicant should comply with ------ of the following to be merchant banker: ( )
i. he applicant should be a body corporate
ii.The applicant should not carry on any business other than those connected with the
securities market
iii.The applicant must have at least two employees with prior experience in merchant banking
iv. Any associate company, group company, subsidiary or interconnected company of
theapplicant should have been a registered merchant banker
1) i , ii &iv 2) i & ii 3) i, ii & iii 4) All
5) None of the above
36. The applicant , who wants to be merchant banker, should have a minimum net worth of
Rs.---------- crores ( )
1) 5 2) 6 3)7 4)8 5)None of the above
37. Bid Bond Guarantee, Advance Payment Guarantee , Performance Guarantee Down, Payment
Guarantee , Retention Money Guarantee , Maintenance Guarantee, Overseas Borrowing Guarantee
are ------------ activities of merchant bank. ( )
1) General 2) Special 3) Fund 4) Non-fund 5)All of the above
38. Pre-shipment credit both in Indian rupees and in foreign currency to extend financial assistance
for procuring/manufacturing/ processing/ packing/ shipping goods meant for export is ------------
Activity. ( )
1) General 2)Special 3)Fund 4)Non-fund
5) None of the above
39. When a project export is on deferred Credit terms, we meet the financial requirement of our
exporter by Rupee/ Foreign currency ------------ ( )
1) Suppliers Credit 2) Buyers Credit 3) Suppliers Credit
4) Exporters credit 5) All of the above
40. Merchant Bank also participates in grant of credit to foreign buyers under the -------------
Scheme of Exim Bank. ( )
1) Suppliers Credit 2) Buyers Credit 3)Suppliers Credit 4)Exporters credit
5) None of the above
41. The East India Trading Company secured a Royal Warrant from England, providing the firm
with official rights to ----------- trading activities in India. ( )
1) Bureaucratic
2) Lucrative
3) Systematic
4) a&b
5) All of the above
1) Hudson Bay
2) India Trading
3) East India
4) All
5) None of the above
43. The American colonies also represent the product of merchant banking, as evidenced by the
activities of the famous -----------------.( )
1) East India
2) India Trading
3) Hudson Bay
4) All
5) None of the above
1) Ruin
2) Fuel
3) Share
4) None of the above
5) All of the above
45. Merchant Banking, as the term has evolved in Europe from the 18th century to
today,pertained to an individual or a banking house whose primary function was to facilitate the
----------------- . ( )
1) Business process
2) Trading
3) Life
4) All
5) None of the above
46. Till early --------------, there was no merchant banking in the Indian banking system. ( )
1) 1960
2) 1965
3) 1967
4) 1970
5) None of the above
47. Grindlays Bank which started merchant banking services as far back as ------- in India. ( )
1) 1962
2) 1965
3) 1967
4) 1970
5) None of the above
1) 1969
2) 1970
3) 1972
4) 1975
5) None of the above
1) 1969
2) 1970
3) 1972
4) 1975
5) None of the above
50. The boom in the capital market in mid 1970sin India with the introduction of FERA
----------- encouraged other banks and financial institutions to set up MB divisions. ( )
1) 1969
2) 1970
3) 1972
4) 1973
5) None of the above
KEY
1. Commercial banks
2. Savings & Investments
3. trade & Commerce
4. balanced
5. public
6. Schedule bank
7. business
8. liquid assets
9. Statutory liquidity Ratio
10. Cash Reserve Ratio.
11. The open market operations
12. Asset Liability
13. Gap analysis
14. Duration Method
15. Non performing Asset
16. Indian Banking
17. Commercial banking
18. monopoly
19. Non banking finance companies
20. Nidhis or chit funds.
21. Investment company
22. Net owned fund.
23. 19 Public Sector
24. Company
25. Internal Factors
26. fee-based
27. arrange
28. Italy
29. U.K.,
30. 1983-84
31. Grindlays Bank
32. Financial Consultancy
33. City Bank
34. 1972
35. 1974
36. Non-Banking Financial Companies
37. Loan syndication
38. corporate counseling
39. corporate securities
40. Pricing of issue
41. post issue management
42. Underwriting
43. different companies
44. four categories
45. first category
46. second category
47. third category
48. fourth category
49. un-audited
50. less
Multiple Choice Questions - UNIT 2
3. The holder of B/E can _________________ the B/E up to the date of maturity or before the
dateof maturity. ( )
1) Hold or discount 2) transfer 3) deliver 4) Issue 5) All of the above
29. The Activity of merchant bankers which facilitate issue process is termed as -----( )
1) Merchant banking 2) Investment Banking 3)Modern Banking
4) Mortgage Banking 5) All of the above
30. A merchant banking company has been exempted from the provisions of Section 45-IA ,Section
45-IB and 45-IC of the ---------------- Act, 1934. ( )
1) RBI 2) SEBI 3)IT 4)a& b 5) None of the above
31. It is registered with the Securities and Exchange Board of India as a Merchant Banker
underSection ----------- of the Securities and Exchange Board of India Act, 1992. ( )
1) 10 2) 11 3)12 4) 13 5)All of the above
32. ---------- is carrying on the business in accordance with the Securities and Exchange Board
ofIndia Merchant Banking (Rules) 1992. ( )
1) Commercial Banking 2) Investment Banking 3)Merchant Banking
4) b&c 5) None of the above
33. Merchant Bank does not accept or hold --------- deposits as defined in paragraph 2(1)(xii) of
theNotification No. DFC 118/DG(SPT)-98 dated January 31, 1998. ( )
1) Private 2) Public 3) Recurring 4) Fixed
5) All of the above
34. Registration with SEBI is --- to carry out the business of merchant banking in India. ( )
1) Optional 2) Mandatory 3) Not required 4) Up to RBI
5) None of the above
35. An applicant should comply with ------ of the following to be merchant banker: ( )
i. he applicant should be a body corporate
ii.The applicant should not carry on any business other than those connected with the
securities market
iii.The applicant must have at least two employees with prior experience in merchant banking
iv. Any associate company, group company, subsidiary or interconnected company of
theapplicant should have been a registered merchant banker
1) i , ii &iv 2) i & ii 3) i, ii & iii 4) All
5) None of the above
36. The applicant , who wants to be merchant banker, should have a minimum net worth of
Rs.---------- crores ( )
1) 5 2) 6 3)7 4)8 5)None of the above
37. Bid Bond Guarantee, Advance Payment Guarantee , Performance Guarantee Down,
PaymentGuarantee , Retention Money Guarantee , Maintenance Guarantee, Overseas Borrowing
Guarantee are ------------ activities of merchant bank. ( )
1) General 2) Special 3) Fund 4) Non-fund 5)All of the above
38. Pre-shipment credit both in Indian rupees and in foreign currency to extend financial assistance
for procuring/manufacturing/ processing/ packing/ shipping goods meant for export is ------------
Activity. ( )
1) General 2)Special 3)Fund 4)Non-fund
5) None of the above
39. When a project export is on deferred Credit terms, we meet the financial requirement of our
exporter by Rupee/ Foreign currency ------------ ( )
1) Suppliers Credit 2) Buyers Credit 3) Suppliers Credit
4) Exporters credit 5) All of the above
40. Merchant Bank also participates in grant of credit to foreign buyers under the
-------------Scheme of Exim Bank. ( )
1) Suppliers Credit 2) Buyers Credit 3)Suppliers Credit 4)Exporters credit
5) None of the above
41. The East India Trading Company secured a Royal Warrant from England, providing the firm
with official rights to ----------- trading activities in India. ( )
1) Bureaucratic
2) Lucrative
3) Systematic
4) a&b
5) All of the above
42. -----------------Trading Company involved in financing, negotiating, and implementing trade
transactions in India ( )
1) Hudson Bay
2) India Trading
3) East India
4) All
5) None of the above
43. The American colonies also represent the product of merchant banking, as evidenced by the
activities of the famous -----------------.( )
1) East India
2) India Trading
3) Hudson Bay
4) All
5) None of the above
1) Ruin
2) Fuel
3) Share
4) None of the above
5) All of the above
45. Merchant Banking, as the term has evolved in Europe from the 18th century to
today,pertained to an individual or a banking house whose primary function was to facilitate the
----------------- . ( )
1) Business process
2) Trading
3) Life
4) All
5) None of the above
46. Till early --------------, there was no merchant banking in the Indian banking system. ( )
1) 1960
2) 1965
3) 1967
4) 1970
5) None of the above
47. Grindlays Bank which started merchant banking services as far back as ------- in India. ( )
1) 1962
2) 1965
3) 1967
4) 1970
5) None of the above
1) 1969
2) 1970
3) 1972
4) 1975
5) None of the above
1) 1969
2) 1970
3) 1972
4) 1975
5) None of the above
50. The boom in the capital market in mid 1970sin India with the introduction of FERA
---------- encouraged other banks and financial institutions to set up MB divisions. (
1) 1969
2) 1970
3) 1972
4) 1973
5) None of the above
Multiple Choice Questions KEY
1. Merchant Banker
2. Demand & supply
3. L AAA
4. AAA
5. All
6. Both
7. Crisil
8. Credit
9. 26
10. De Materialization
11. All
12. All
13. Capital market
14. Securities & exchange board of India
15. All
16. SEBI
17. Issue management
18. SEBI
19. Merchant banking
20. Financial intermediary
21. Usance bill
22. Sight or on presentment
23. Hold or discount
24. Holder
25. Company
26. merchant banker
27. Raise
28. Underwrites
29. merchant banking
30. RBI
31. a
32. Merchant Banking
33. Public
34. Mandatory
35. all
36. 5
37. Non-fund
38. fund
39. Exporters credit
40. Buyers Credit
41. Lucrative
42. East India
43. Hudson Bay
44. Fuel
45. Business process
46. 1960
47. 1967
48. 1970
49. 1972
50. 1973
KEY
1. Commercial banks
2. Savings & Investments
3. trade & Commerce
4. balanced
5. public
6. Schedule bank
7. business
8. liquid assets
9. Statutory liquidity Ratio
10. Cash Reserve Ratio.
11. The open market operations
12. Asset Liability
13. Gap analysis
14. Duration Method
15. Non performing Asset
16. Indian Banking
17. Commercial banking
18. monopoly
19. Non banking finance companies
20. Nidhis or chit funds.
21. Investment company
22. Net owned fund.
23. 19 Public Sector
24. Company
25. Internal Factors
26. fee-based
27. arrange
28. Italy
29. U.K.,
30. 1983-84
31. Grindlays Bank
32. Financial Consultancy
33. City Bank
34. 1972
35. 1974
36. Non-Banking Financial Companies
37. Loan syndication
38. corporate counseling
39. corporate securities
40. Pricing of issue
41. post issue management
42. Underwriting
43. different companies
44. four categories
45. first category
46. second category
47. third category
48. fourth category
49. un-audited
50. less
MULTIPLE CHOICE QUESTIONS - UNIT 3
1) User (hier) 2)Seller 3)Holder 4) All of the above 5) None of the above
3. B E L R ______________________( )
1)lessor 2)lessee 3) Hire vendor 4) All of the above 5)None of the above
1)Lease rentals 2) Lease Payments 3) Leased Asset 4)All of the above 5)None of the above
7. The break even lease rental of the lessor sets the __________( )
1)Lower limit. 2)higher limit 3) break even limit 4) All of the above 5)None of the above
10. The Depreciation on the asset is charged in the books of the ________( )
1)hired asset 2)leased asset 3) purchased asset 4) All of the above 5)None of the above
12. Decision extension from the point of view of a hire is the cost of___________.( )
1)Hire purchase. 2)hire agreement 3) lease agreement 4) Leased sale. 5)None of the above
1)Sales tax 2)Income tax 3) excise duties 4) import duties 5)None of the above
15. The interstate hire purchase deals attract ___________________.( )
1)Central sales tax. 2)Income tax 3) excise duties 4) import duties 5)All of the above
1)Interstate 2) Intra State 3) out of the country 4) All of the above 5)None of the above
1)Development bank 2) Andhra Bank 3) State Bank 4)All of the above 5)None
19. Lease finance and_______________ are generally used to acquire capital goods. ( )
1)hire purchase 2) Lease rentals 3) Hiring finance 4) Leased asset 5)All of the above
24. The tax expects of leasing pertain to both income tax and____________( )
1)Sales tax. 2) export duties 3) import duties 4) All of the above 5)None of the above
25. The Computation of taxable income of an assesse under the provisions of the ___________( )
1)Income tax act. 2)sales tax 3) export duties 4) import duties 5)None of the above
27. The concept of financial leasing was pioneered in India during ---------------.( )
28. The first leasing company was setup by the ------------ group in 1973 in Madras. ( )
1) Negotiation
2) Agreement
3) Bailment
4) Arrangement
5) Contract
32. The provisions relating to bailment in the -------- Act govern equipment leasing agreements.
1) Indian contract
2) Indian Negotiation Act
3) Indian Bailment act
4) Indian Arrangement Act
5) None of the above
33. As per the --------------, the lessee can claim lease rentals as tax deductible expenses.
1) Income tax
2) Sales tax
3) Commercial tax
4) a&b
5) None of the above
35. The leasslor can claim investment allowance and depreciation on the investment made in leased
assets under ----------------------- Act.
1) Income tax
2) Sales tax
3) Commercial tax
4) a&b
5) None of the above
36. -------------- is a mode of financing the price of the goods to be sold on a future date.
1) Leasing
2) Factoring
3) Forfeiting
4) Hire Purchase
5) None of the above
37. -------------------- agreement is defined as peculiar kind of transaction in which the goods are let on
hire with an option to the hirer to purchase them
1) Leasing
2) Factoring
3) Hire Purchase
4) Forfeiting
5) All of the above
1) Bonds
2) Stock
3) Debentures
4) Equipment
5) None of the above
39. In hire purchase, depreciation and investment allowance can be claimed by ---------
1) Bailor
2) Bailee
3) hirer
4) Hiree
5) None of the above
40. In --------------, the Transfer of right of use by the owner (Lessor) to the User (Lessee) is done for an
agreed period of time.
1) Equipment Leasing
2) Rental Leasing
3) Fixed Leasing
4) Operational Leasing
5) All of the above
41. A ------------ is an agreement whereby the lessor conveys to the lesses in return for payment or
series of payments the right to use an asset for an agreed period of time.
1) Lease
2) Hiring
3) Hire Purchase
4) Forfeiting
5) None of the above
42. A ---------------- is a lease that transfers substantially all the risks and rewards incident ownership of
an asset.
1) Financial Leasing
2) Operating Leasing
3) Equipment Leasing
4) All of the above
5) None of the above
1) Financial Leasing
2) Operating Leasing
3) Equipment Leasing
4) All of the above
5) None of the above
44. A ------------------- is a lease that is cancellable when the occurrence of some remote contingency.
1) Cancellable
2) Non-cancellable
3) financial
4) Operational
5) None of the above
45. The ------------------ is the non cancellable period for which the lessee has agreed to lease the asset
together with any further terms for which the lessee has the option to continue to lease the asset.
1) Gestation period
2) Assessment Period
3) Lease Term
4) Agreement period
5) All of the above
46. It is the amount for which an asset should be exchanged or a liability settled between
knowledgeable, willing parties in an arms length transaction.
1) Financial Leasing
2) Operating Leasing
3) Equipment Leasing
4) All of the above
5) None of the above
47. The period over which an asset is expected to be economically usable by one or more
users-------------
1) Operating Life
2) Expected Life
3) Economic Life
4) Usefullife
5) None of the above
48. The period over which the leased asset is expected to be used by the lessee-----------.
1) Operating Life
2) Expected Life
3) Economic Life
4) Usefullife
5) All of the above
49. -------------- of a leased asset is the estimated fair value of the asset at the end of the least term.
1) Residual value
2) Expected Value
3) Economic Value
4) All of the above
5) None of the above
50. The part of the residual value which is guaranteed by the lessee or by a party on behalf of
lessee----------------------.
1) Residual value
2) Expected Value
3) Economic Value
4) Guaranteed residual value
5) None of the above
1. User (hirer)
2. Investment
3. Break even lease rental
4. Direct Lease
5. Lessor
6. Lease rentals
7. Lower limit
8. Hire purchase
9. Peculiar
10. Lessor.
11. Hired asset
12. Hire purchase
1. Commercial banks
2. Savings & Investments
3. Trade & Commerce
4. Balanced
5. Public
6. Schedule bank
7. business
8. Liquid assets
9. Statutory liquidity Ratio
10. Cash Reserve Ratio.
11. The open market operations
12. Asset Liability
13. Gap analysis
14. Duration Method
15. Non performing Asset
16. Indian Banking
17. Commercial banking
18. Monopoly
19. Non banking finance companies
20. Nidhis or chit funds.
21. Investment company
22. Net owned fund.
23. 19 Public Sector
24. Company
25. Internal Factors
26. selling goods
27. last Installment
28. Hire purchase
29. Hire Purchase Act, 1972
30. flat rate.
31. I = (n / n-1)2F
32. stock on hire.
33. un-matured finance charges
34. Unguaranteed
35. Net investment
36. Implicit interest
37. Contingent rent
38. service lease
39. less than
40. Financial lease
41. Operating leasing
42. A leverage lease
43. sale and lease back
44. transnational leasing
45. Cross Border Lease
46. Default risk
47. Residual Value Risk
48. Interest rate risk
49. Purchasing Power Risk
50. Political Risk
2. Insurance is a ---------.( )
3. The document of laying down the terms of the contract is called ------------------( )
1)Insurance policy 2) Insurance claim 3)Insurance Product 4)1&2 5)None of the above
5. Depending upon the subject matter the insurance is classified into -------types. ( )
10. The Interest which the insured has in the subject matter of insurance is known as -------------.
( )
17. The Insurance Act, --------- Provides broad frame work for Insurance. ( )
19. Any Public company or Cooperative society having --------- of paid up capital is eligible
forinsurance business. ( )
20. No body of insurance company should hold more than -------- of stake.
22. Life Business means the business of effecting contracts of insurance upon --------( )
27. The part of an insurance premium paid by the insurer to an agent or broker for his services
in procuring and servicing the insurance is called as_________________.( )
28. ________________is given to the policy holder to pay the premium amount aftercompletion
of maturity date. ( )
1)Grace days 2)additional days 3)further days 4)All the above 5) None of the above
29. The printed form which serves as the contract between an insurer and an insured
is________________( )
31. Insurance sector in India is one of the booming sectors of the economy and is growing atthe
rate of _______________ per cent annum.
1) 15-20 % .
2) 20%
3) 30%
4) 40%
5) 60%
32. Together with banking services, it contributes to about ____________ to the country's GDP.
1) 7%
2) 8%
3) 9%
4) 2%
5) 3%
33. Insurance is a federal subject in India and Insurance industry in India is governed
byInsurance Act, ______________
1) 1938
2) 1948
3) 1958
4) 1968
5) 1970
34. The origin of life insurance in India can be traced back to 1818 with the establishment ofthe
_________________Company in Calcutt1)
1) Indian
2) foreign
3) 1&2
4) Banking industry
5) None of the above
36. In 1912, insurance regulation formally began with the passing of Life InsuranceCompanies
Act and the _______________Act.
1) PF
2) ESI
3) Gratuity
4) All the above
5) None of the above
37. In 1938, the first comprehensive legislation regarding insurance was introduced with
thepassing of Insurance Act of 1938 that provided strict State ________________over insurance
business.
1) Control
2) liberal
3) reform
4) all
5) None of the above
38. In 1956, Government of India brought together ___________ Indian and foreign
insurersand provident societies under one nationalized monopoly
1) 245
2) 240
3) 255
4) 260
5) 290
39. In 1993, the first step towards insurance sector reforms was initiated with the formation of
__________Committee
1) Malhotra
2) Sundaram
3) Vivekan
4) Narasimham
5) Dinkar
40. The committee was formed to evaluate the Indian insurance industry and recommend
its________________direction
1) Future
2) Past
3) Present
4) 1946
5) None of the above
1) Malhotra
2) sundaram
3) vivekan
4) Narasimham
5) Dinakaran
42. Insurance sector in India was liberalized in March 2000 with the passage of
the__________________________
1) IRDA
2) SEBI
3) RBI
4) LIC
5) None of the above
43. There is a 26 percent equity cap for foreign partners in an insurance company
1) 26 %
2) 25%
3) 20%
4) 15%
5) 50%
44. The opening up of the ________________sector has led to rapid growth of the sector.
1) insurance
2) Banking
3) Service
4) industry
5) All the above
1) 15
2) 16
3) 20
4) 50
5) Nil
1) 15
2) 16
3) 20
4) 45
5) NIL
47. The potential for growth of insurance industry in India is immense as nearly _______
percent of Indian population.
1) 80
2) 70
3) 60
4) 50
5) 45
48. ------------ should be given that LIC should pay interest on delays in payments beyond 30 days.
1) Customer service
2) Govt. service
3) Banking service
4) All the above
5) None of the above
49. Committee proposed that Insurance companies must be encouraged to set
up________________ plans.
1) Computerization
2) modernization
3) Liberalization
4) Decentralization
5) Nationalization
MULTIPLE CHOICE KEY: UNIT 4
1. Pool
2. Contract.
3. Insurance Policy
4. property
5. two
6. An individual
7. General insurance
8. Life Insurance
9. Variable
10. Insurable interest
11. contract indemnity
12. Indemnity.
13. General
14. Life
15. Annual
16. Continuous
17. 1938
18. Cooperative society
19. 100 Crores
20. 26
21. IRDA
22. Human life.
23. General
24. Risk
25. Risk
26. Accident
27. commission
28. Grace days
29. insurance policy
30. Risk
31. 15-20 per cent annum
32. 7 per cent
33. 1938
34. Oriental Life Insurance
35. Indian
36. PF
37. Control
38. 245
39. Malhotra
40. Future
41. Malhotra
42. IRDA
43. 26 %
44. insurance
45. 16
46. 15
47. 80
48. Customer service
49. unit linked pension
50. Computerization
UNIT-5
Multiple Choice questions]
1.An agreement in which receivables are sold by a firm to the financial intermediary is known
as__________________ ( )
1)Factoring 2)Bills receivables 3)Bills payables 4)Bills discounting 5)None of the above
1)Two buyers 2)Two sellers 3)Buyer & seller 4)1 & 2 5) None
1) 2 2) 3 3) 4 4) 5 5) 6
1)Full factoring 2)Partial factoring 3)Non- factoring 4)All 5)None of the above
10. Frame work of credit rating in India
12. The extensive compilation & analysis of data for rating business is also used to
provideinformation services to_______________ clients. ( )
1)Corporate 2)Individuals 3)Financial institutions 4)All the above 5)None of the above
13. Most of the firms treat account receivable as a marketing tool to promote sales
&__________ ( )
1)Working Capital 2)Current assets 3)Current liabilities 4)All 5)None of the above
1)Increasing sales 2)Increasing profit 3)Extra profit 4)All 5)None of the above
21. Forfeiting means __ the right to future payments through discounting future cash flows. ( )
1) Better cash flows 2) Better assets management 3) Better administration 4) All 5)None
28. In -------------------- drawer undertakes the responsibility of collecting the bills and
remittingthe proceeds to financing agency,
1) Factoring
2) discounting
3) Forfeiting
4) 1&3
5) None
29. Whereas a --------- usually undertakes to collect the bills of the client
1) Factor
2) Drawer
3) Forfeiter
4) 1&3
5) None
1) Factor
2) Loss
3) Profit
4) Provision
5) None
31. Discounted bills may be rediscounted ------------- before they mature for payment.
1) Once
2) Twice
3) Thrice
4) Several Times
5) None of the above
32. Debts purchased for factoring cannot be rediscounted, they can be -------------
1) Refined
2) Forfeited
3) Refinanced
4) 1&3
5) None of the above
33. Factoring implies the provision of ---------- finance against several unpaid trade generated
invoices in batches.
1) Short
2) Bulk
3) Refinance
4) 1&2
5) None
1) Off-balance
2) On-balance
3) Special Drawing
4) 1&2
5) None
36. Bill discounting -------------- involve assignment of debts as is the case with factoring
1) Does
2) Does not
3) May
4) May not
5) None
1) One
2) Two
3) Three
4) Four
5) Five
38. ----------- system results in to separate but inter-linked agreements such as between
exporterand export factor or between export factor import factor.
1) One
2) Two
3) Three
4) Four
5) Five
39. ---------------- provides a link between export factor and the importer and serves to solve
theinternational barriers like language problem, legal formalities and so on.
1) Export factor
2) Import Factor
3) Exporter
4) Importer
5) None
40. --------------- also underwrites customer trade credit risks, collects receivables and
transfersfunds to the export factor in the currency of the invoice
1) Export factor
2) Importer
3) Exporter
4) Importer Factor
5) None
41. ---------------- informs the export factor about the export of goods to a particular importclient
domiciled in a specified country.
1) Export factor
2) Import Factor
3) Exporter
4) Importer
5) None
42. --------------- writes a letter to import factor (domiciled in the country of the
importer)enquiring about the credit-worthiness, reputation and so on of the importer.
1) Export factor
2) Import Factor
3) Exporter
4) Importer
5) None
43. Export receivables are factored on a ------------- basis.
1) Resource
2) Recourse
3) Non-recourse
4) Remarks
5) None
44. --------------- does credit checking, sales ledgering and collection to the import factor
1) Exporter
2) Importer
3) Export factor
4) Import Factor
5) None
45. Import factor collects the ------------ from the importer and effects payments to the
exportfactor on assignment/maturity/collection as per the terms of assignment in the currency of the
invoice
1) Bills
2) Order
3) Statement
4) Payment
5) None
46. The export factor makes payment to the exporter upon --------------------- depending uponthe
factoring agreement between them
1) Assignment
2) Maturity
3) Collection
4) Either or
5) None
1) Receivables
2) Payables
3) Assets
4) 1&2
5) None
1) Factoring
2) Discounting
3) Forfeiting
4) 1&3
5) None
49. In pursuance of a commercial contract between an exporter and importer, the exporter
sellsand delivers the goods to the importer on a --------------- basis
1) Down Payment
2) Deferred
3) Exporter
4) Importer
5) None
50. Importer draws a series of ---------------- in favor of the exporter for payment
includinginterest charge.
1) Bill
2) LOC
3) Promissory Notes
4) Either 1 or 2
5) None
1. Factoring
2. Credit sales
3. Buyer & seller
4. Letter of exchange
5. 2
6. Recourse.
7. Rediscounted
8. Factoring
9. Full factoring
10. All of the above
11. All of the above
12. Corporate
13. Profit
14. Working capital
15. Credit
16. Receivables management
17. All
18. All
19. Cash
20. B/R
21. Forfeiting
22. RBI
23. Debtors
24. All
25. All
26. Recourse
27. Factoring
28. Bill discounting
29. Factor
30. Provision
31. Several times
32. Refinanced
33. Bulk
34. Individual
35. Off-balance
36. Does not
37. Four
38. Two factors
39. Import factor
40. Import factor
41. Exporter
42. Export factor
43. Non-recourse
44. Export factor
45. Payment
46. Assignment or maturity or collection
47. (export) Receivables
48. Forfeiting
49. Deferred payment
50. Promissory notes
53) ICRA is a public limited company with an authorized share capital of ----------------.
54) ICRAs initial paid up capital of ----------- crores was subscribed by IFC, UTI, LIC, GIC SBI
and others.
55) The CARE was promoted in ------------ jointly with investment companies, banks and
finance companies.
1. Factor
2. Realization
3. Seller
4. Memorandum of Understanding
5. 80 %
6. Sales ledger
7. Receivables
8. Purchases
9. Without recourse
10. Recourse
11. Disclosed factor
12. International factoring
13. Undertaking
14. Recourse
15. Bill discounting
16. Rediscounted
17. Bulk financing
18. Factoring commission
19. Recourse factoring
20. RBI
21. Subsidiary/ joint venture factoring company
22. Finance companies
23. Disclaimer certificate
24. Documentary bill
25. Clean bills
26. Credit rating
27. Financial history
28. Pay back a loan
29. High risk
30. Borrowing and repayment
31. Credit
32. Capacity of the issuer of debt security
33. Code numbers
34. Security
35. Debt rating
36. Fiduciary relationship
37. Investor protection
38. Credit Rating Information Services Ltd
39. Investment Information and Credit Rating Agency of India
40. CARE
41. Duff Phelps Credit Rating Pvt. Ltd. (DCR India)
42. January 1, 1988
43. 4 crores.
44. CRISIL
45. Service rating agency
46. Opinions on risk
47. Rate the debt obligations
48. Timely payment of interest and principal
49. 1991
50. Investment information
Assignment Questions
Unit 1
1. Define Financial services.
9. What are the different financial services provided by Indian financial system?
Unit 3
1. What is Factoring?
2. Discuss various types of Factoring.
3. Distinguish Between Factoring and Discounting.
4. Discuss about different Credit Rating Agencies in India.
5. Discuss the Types of Rating
6. Explain Costs of Factoring
7. Explain Types of Export Factoring
8. Briefly explain calculationof discount charges and effective interest rates of factoring
9. Define bill discounting
10.Distinguish bill discounting vs factoring
11.Explain the features of kalian sundaram committee
12.Explain decision analysis of fctoring
13.Who are parties involved in factoring
14.What are the functions of factor
15. Explain the evaluation procedure of factoring
16.Explain the evaluation procedure for bill discounting
17.Define forfeiting
18. What are different characteristics of factoring
19.Explain briefly difference between factoring and forefeiting
20.What are different functions of forfeiting?
Unit 4
1. What is venture capital?
Unit-5
1. What is a portfolio management?
11.Define:
a. Underwriter
b. Registrar
c. Lead manager