31/08/2021 Section A, Financial Markets, Quiz 1

Section A, Financial Markets, Quiz 1

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Repos are

only A and B of the above.

A) usually low-risk loans.

B) usually collateralized with Treasury securities.

all of the rest.

C) low interest rate loans.

What is the objective of SLR and CRR? (a) Financial position of Bank (b) Liquidity
position of Bank (c) Profit position of Bank

Only 'a' is correct

All correct!

Both 'a' and 'b' is correct

Only 'b' is correct

Only 'c' is correct

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31/08/2021 Section A, Financial Markets, Quiz 1
Only c is correct

Which is not correct about commercial papers?

It is cheaper than a bank loan

It doesnot create any lien on assets of the company

It is a cost effective way of raising working capital

It is not regulated by RBI

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Every financial market performs the following function

It allows common stock to be traded.

It channels funds from lenders-savers to borrowers-spenders.

It determines the level of interest rates.

All of these

It allows loans to be made.

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31/08/2021 Section A, Financial Markets, Quiz 1

Treasury bills do not

have a face amount.

pay interest.

have an active secondary market

have a maturity date.

Which is not a factor for influencing Call Rates

Reserve requirement

Tax outflows

Credit Rating

Demand deposits

Which is not a Money Market Instrument?

Commercial Paper

Commercial Bills

Equity Shares

Certificates of Deposit

Preferred Shares

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31/08/2021 Section A, Financial Markets, Quiz 1

Which is not Correct?

Current Bank Rate is 4.65%

Current Marginal Standing Facility Rate 4.25%

Current Repo Rate is 4%

Current Reverse Repo Rate is 3.25%

A country whose financial markets function poorly is likely to

Efficiently allocate its capital resources.

Enjoy high productivity.

Experience economic hardship and financial crises.

Increase its standard of living.

None of These

Financial market activities affect

C) the economy's location in the business cycle.

A) personal wealth.

B) spending decisions by individuals and business firms.

All of these

only A and B

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31/08/2021 Section A, Financial Markets, Quiz 1

Money market securities have all the following characteristics except they are
not

short term.

All of the rest

money.

low risk.

very liquid

Which is correct regarding Money Market?

All of the Rest

Money Market is for short term fund

Matuarity ranges from overnight to one year

Basic Function of Money market is to provide liquidity position

Interest Payment on money market instruments is

Annually

Twice a year (semiannual)

At maturity

Upon request

All of these

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31/08/2021 Section A, Financial Markets, Quiz 1

A negotiable certificate of deposit

A) is a term security because it has a specified maturity date.

B) is a bearer instrument, meaning whoever holds the certificate at maturity receives

the principal and interest.

C) can be bought and sold until maturity.

all of the Rest.

D) only A and B

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What structure is responsible in an economy to channelize the capital from

various surplus sectors of the economy and allocate and distribute the same to
the various needy sectors.

Financial System

Financial Market

All of the Rest

Financial Environment

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31/08/2021 Section A, Financial Markets, Quiz 1
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