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Q.1
Which of the following is an advantage of a 401(k) plan?
Most employers match a portion of your contributions.
You may withdraw funds at any time without penalty.
You never pay taxes on your contributions.
Your contributions are invested in high-return, high-risk fund
Q.2
Which of the following financial organizations specializes in buying installment contracts from merchants who sell on credit?
a bank
a credit union
a finance company
an insurance company
Q.3
_______ a situation in which the outcome is not certain, but the probabilities can be estimated
equities
portfolio diversification
risk
bond
Q.4
A commercial bill is used to _____________
Finance the working capital requirements
Meet the short term debt
Meet the long term debt
Pay the interest
Q.5
Typically, the interest rate on corporate bonds will be ________ the more restrictions are placed on management through restrictive covenants, because ________.
higher; corporate earnings will be limited by the restrictions
higher; the bonds will be considered safer by bondholders
lower; the bonds will be considered safer by buyers
lower; corporate earnings will be higher with more restrictions in place
Q.6
If you expect that the price of a stock will decline, which of the following are you most likely do?
Buy a put option on the stock.
Buy a call option on the stock.
Write a put option on the stock.
Buy the stock on margin.
Q.7
Who is acting as both the broker and jobber?
Budlawalas
Tarawaniwalas
Hedger
Speculators
Q.8
What is the name of fictitious transactions in the share market?
Nil transactions
Blank sales
Wash sales
White sales
Q.9
If theinflation rate in Britain is 6 percent, and the inflation rate in the U.S. is 4 percent, then the theory of purchasing power parity predicts that, duringthe value of the British pound in terms of U.S. dollars will
rise by 10 percent.
rise by 2 percent.
fall by 10 percent.
fall by 2 percent.
Q.10
A capital market is ideal when:
Financial institutions are sufficiently developed
Finance is available at a reasonable cost
Capital is most productively allocated
All of these
Q.11
When a trade bill is accepted by a commercial bank, it is known as a _____
Commercial Bill
Call money
None of these
Certificate of deposit
Q.12
Money market deals in _____________________
Medium-term securities
Short term Securities
Long term Securities
None of these
Q.13
Jayant is holding a hundred shares of a company. He has been given a privileged offered to subscribe to a new issue of shares of the same company in the proportion of 2:1 to the number of shares already possessed by him. Identify the method of floatation being described in the above case.
Offer through prospectus
Offer for sale
Rights issue
Private placement
Q.14
On this day, the exchange will deliver the share or make payment to the other broker
Pay-in day
Pay-out day
Transaction day
None of the above
Q.15
It is a legally enforceable document which is issued by a stockbroker withinhours of the execution of a trade order.
PAN number
Unique Order Code
Contract Note
None of the above
Q.16
Under this method of floatation in the primary market, a subscription is invited from the general public to invest in the securities of a company through the issue of advertisement.
Private placement
Offer through prospectus
Offer for sale
All of the above
Q.17
----------------- is based on the uncertain event whose result determined by chance or accident
Gambling
Speculation
Dead cat bouncing
Market fluctuations
Q.18
Professional independent brokers are called------------------
Broker
Hedger
Jobber
Budlawalas
Q.19
The financial results of a company show that it has suffered losses due to decliningmarket share. The price of its equity share drops in the market. This is an example of therole of the market as: _________.
Provider of liquidity
Orderly channel for transfer of funds from investors to issuers
Generator of productive investments
Information Signalling through prices
Q.20
When a bear is unable to meet his commitment immediately he becomes--------------
Stag
Cat
Duck
Bear
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