CAIIB

150 Practice Questions

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150 Practice Questions CAIIB ABM

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Practice Questions for CAIIB - ABM

Q1. In business cycle, what follows after depression......

(a)Boom
(b)Depression
(c)Recession
(d)Recovery

Ans - b

Q2. A situation where an employee feels that there is decrease in his level of
responsibility or his skill is not being fully utilised is called ......
(a)Role Isolation
(b)Role Erosion
(c)Role Inadequacy
(d)Role Expectation Conflict

Ans - d

Q3. For external credit rating, banks depend on ......

(a)Retired experienced staff of the bank
(b)Banking consultants
(c)Rating agencies
(d)None of the above

Ans - c

Q4. Business Cycle is also called as ......

(a)Economic cycle
(b)Entrepreneur cycle
(c)Social cycle
(d)Vicious cycle

Ans – a

Directions[5-10]: A firm has a capital of Rs. 400, Term Loan

400, Sundry Creditors 130, Stock 224 cash 62,
Debtors 46 and Fixed Assets 868.
Answer following questions

Q5. If profit are 67, Return on equity would be ......

(a) 16.75%
(b) 15.50%
(c) 10.00%
(d) 20.00%

Ans - c
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Q6. If Sales are 920 the Debt turnover ratio would be ......
(a)10 times
(b)20 times
(c)0.5 month
(d) 1 month

Ans - b

Q.7 Its Debt Equity Ratio

(a) 0.6:1
(b) 0.9:1
(c) 1.1:1
(d) 2:1

Ans - a

Q8. Net worth and tangible net worth is ......

(a) 270, 400
(b) 270, 624
(c) 670, 670
(d) 624, 670

Ans - c

Q9. The quick ratio would be ......

(a) 1:1
(b) 0.83:1
(c) 0.65:1
(d) 0.44:1

Ans - b
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Q10. Current ratio is ......

(a) 1.25:1
(b) 1.85:1
(c) 2.1:1
(d) 2.55:1

Ans - d

Directions[11-16]: As on end of previous financial year 2020-21, XYZ Bank has:

Total Advances = Rs. 160000 Cr
ANBC (Adjusted Net Bank Credit) = Rs. 150000 Cr
Agriculture Advances = Rs. 27000 Cr
MSE Advances = Rs. 10000 Cr
Weaker Section Advances = Rs. 17000 Cr
Total Priority Sector Advances = Rs. 58000 Cr

Q11. Whether the Bank has achieved the target for Agriculture
Advances?
(a)Yes. The Bank has just achieved the target
(b)Yes. the Bank has exceeded the target
(c)No. The Bank has defaulted in achieving the target
(d)No such target for Agriculture Advances

Ans - a

Q12. Whether the Bank has achieved the target for MSE Advances?
(a)Yes. The Bank has just achieved the target
(b)Yes. the Bank has exceeded the target
(c)No. The Bank has defaulted in achieving the target
(d)No such target for Agriculture Advances

Ans - d

Q13. Whether the Bank has achieved the target for Weaker Section Advances?
(a)Yes. The Bank has just achieved the target
(b)Yes. the Bank has exceeded the target
(c)No. The Bank has defaulted in achieving the target
(d)No such target for Agriculture Advances

Ans – b

Q14. Whether the Bank has achieved the target for Priority Sector Advances?
(a)Yes. The Bank has just achieved the target
(b)Yes. the Bank has exceeded the target
(c)No. The Bank has defaulted in achieving the target
(d)No such target for Agriculture Advances

Ans – c
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Q15. Which of the following is also known as Gearing Ratio?

(a)Current ratio
(b)Debt Equity Ratio
(c)Debt Service Coverage Ratio
(d)Turnover Ratio

Ans - b

Q16. Purchase of goods on credit _____ DE ratio

(a)Increase
(b)Decrease
(c)No change
(d)None of the above

Ans – c

Directions[17-29]: The debt equity ratio of X Ltd. is 0.5: 1. Which of the

following would increase/decrease or not change the debt equity ratio?

Q17. Redemption of debentures

(a)Increase
(b)Decrease
(c)No change
(d)None of the above

Ans - b

Q18. Sale of goods on cash basis

(a)Increase
(b)Decrease
(c)No change
(d)None of the above

Ans - c

Q19.Further issue of equity shares DE ratio

(a)Increase
(b)Decrease
(c)No change
(d)None of the above

Ans - b

Q20.Cash received fromdebtors__ DE ratio

(a)Increase
(b)Decrease
(c)No change
(d)None of the above

Ans - c
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Q27. For rediscounting commercial instruments, the discount rate used by RBI is
called ......
(a)Base Rate
(b)Bank Rate
(c)Repo Rate
(d)Reverse Repo

Ans - b

Q28. As per Achievement Motivation Theory, needs are ......

(i)Achievement,
(ii)Power,
(iii)Affiliation
(a)Only (i) and (ii)
(b)Only (i) and (iii)
(c)Only (ii) and (iii)
(d)(i), (ii) and (iii)

Ans - d

Q29. Market equilibrium comes at the price at which commodity demanded

equals to quantity ......
(i)Produced, (ii) Supplied
(a)Only (i)
(b)Only (ii)
(c)Either (i) or (ii)
(d)Both (i) and (ii)

Ans - b
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Directions [30-32]: Given the values for the samples 60.25, 62.38, 65.32,
61.41, and 63.23 of a population.

Q30.Calculate Mean
(a) 56.12
(b) 61.52
(c) 62.51
(d) 65.12

Ans - b

Q31. Calculate standard deviation

(a) 1.72
(b) 1.92
(c) 2.19
(d) 2.37

Ans - c

Q32. Calculate coefficient of variance

(a) 0.03071
(b) 0.04071
(c) 0.05071
(d) 0.06071

Ans – b

Directions (33-36): The Concept of Johari Window is related to self-awareness.

The authors Luft and Ingham refer two dimensions i.e how much of one’s
behavior is known to him and how much he feels others known to him.
These two dimensions give four windows (Open, Blind, Hidden and dark). Based
on this concept. Answer the following questions.

Q33. Each of the four windows relate to specific situation. Which of these is
matched?
(a)Open Known to others but not known to self
(b)Blind –Unknown to self and others
(c)Hidden –Known to self and unknown to others.
(d)Dark –known to self and others

Ans - c

Q34. There is need to enhance the open area. If the actual situation is “Hidden”
how the open area can be increased and hidden area reduced.
(a)By receiving feedback from others
(b)By self-disclosure.
(c)By sharing
(d)All he above

Ans - b
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Q35. There is need to enhance the open area. If the actual situation is “Blind”
how the open area can be increased and hidden area reduced.
(a)By receiving feedback from others.
(b)By self-disclosure
(c)By sharing
(d)All he above

Ans - a
Q36. There is need to enhance the open area. If the actual situation is “Dark”
how the open area can be increased and hidden area reduced.
(a)By receiving feedback fromothers
(b)By self-disclosure.
(c)By sharing.
(d)All the above

Ans - c

Directions (37-42): Answer the following questions based on the above

information. Year=2019-20 Nominal GDP=2500 GDP Deflator=120
Year=2020-21 Nominal GDP=3200 GDP Deflator=145

Q37. If GDP Deflator in 2018-19 is 100, then Real GDP of 2020-21 ......
(a) 2207
(b) 2215.5
(c) 2214.7
(d) 2214.6

Ans – c

Q38. If GDP Deflator in 2018-19 is 100, then real GDP of 2019-20 ......
(a) 2083
(b) 2038
(c) 2112
(d) 1961

Ans – a

Q39. Growth Rate of Real GDP from 2019-20 ......

(a) 6.12
(b) 5.95
(c) 5.20
(d) 6.95

Ans - b

Q40. Inflation Rate in 2020-21 in relation to 2019-20 ......

(a) 19.61
(b) 20.83
(c) 20.38
(d) 21.12

Ans – b
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Q41. In which way Yield to Maturity and Interest Rates are related?
(a)Direct
(b)Indirect
(c)Relative
(d)No relation

Ans - a

Q42. Bank has to open a CC Account of Mr. Raj. He also needs term loans for
construction of shed (Term Loan 1) and for purchase of machinery (Term Loan
1). He also needs to negotiate a LC. He requests to open the CC Account
and LC first. Manager had explained him the sequence of opening the Accounts.
What will be the correct sequence?
(a)LC, CC, TL1, TL2
(b)CC, LC, TL1, TL2
(c)TL1, TL2, LC, CC
(d)TL1, TL2, CC, LC

Ans - c

Directions (43-45)
Given,
1.Consumptions - Rs. 62000
2.Gross investment - Rs. 46000
3.Govt spending - Rs. 14000
4.Export - Rs. 96000
5.Import - Rs. 72000
6.Indirect Taxes - Rs. 15000
7.Subsidies (on production and import) - RS. 8000
8.Compensation of employee - Rs. 1000
9.Property Income - Rs. 1000 7,8,9 - Net receivable from aboard
10.Total capital gains from overseas investment - Rs. 18000
11.Income earned by foreign national domestically - Rs. 8000

Q43. Calculate GDP

(a) Rs. 139000
(b) Rs. 146000
(c) Rs. 156000
(d) Rs. 165000

Ans – b

Q44. Calculate GDP at factor cost

(a) Rs. 139000
(b) Rs. 146000
(c) Rs. 156000
(d) Rs. 165000

Ans – a
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Q45. Calculate GNP

(a) Rs. 139000
(b) Rs. 146000
(c) Rs. 156000
(d) Rs. 165000

Ans – c

Directions (46):
1.Revenue deficit (RD) = 3% of GDP
2.Grants for capital formation = 1.8% of GDP
3.Primary deficit (PD) =1.2%
4.non-plan expenditure = 1.5%

Q46. In the above scenario, effective revenue deficit (ERD) will be:
(a) 1.2%
(b) 1.5%
(c) 1.8%
(d) cannot be calculated

Ans - a

Directions (47-52): If Receipts and Expenditures of a Government as per Budget

2020-21 are as given below
1.Revenue Receipts - 1374203
2.Tax Revenue - 1101372
3.Non-Tax Revenue - 272831
4.Capital Receipts - 600991
5.Recovery of Loans - 17630
6.Other Receipts - 47743
7.Borrowings and Other Liabilitites - 535618
8.Expenditure On Revenue Account of which - 1690584
9.Interest Payments - 480714
10.Grants in Aid for creation of capital assets - 165733
11.Expenditure On Capital Account - 284610 Find:

Q47. Total Receipts

(a) 1374203
(b) 1690584
(c) 1975194
(d) 2075416

Ans – c

Q48. Total Expenditure

(a) 1374203
(b) 1690584
(c) 1975194
(d) 2075416

Ans - c
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Q49. Revenue Deficit

(a) 54904
(b) 150648
(c) 316381
(d) 535618

Ans - c

Q50. Effective Revenue Deficit

(a) 54904
(b) 150648
(c) 316381
(d) 535618

Ans - b

Q51. Fiscal deficit

(a) 54904
(b) 150648
(c) 316381
(d) 535618

Ans - d

Q52. Primary Deficit

(a) 54904
(b) 150648
(c) 316381
(d) 535618

Ans - a

Q53. Bills Purchased/Discounted/Negotiated under LC are treated as an

exposure on ......
(a)The Applicant of LC
(b)The Exporter of Goods
(c)LC Negotiating Bank
(d)LC Opening Bank

Ans – d

Q54. Job analysis consists of which of the following? (i) Job Specification, (ii) Job
Description, (iii) Job Evaluation
(a)Only (i) and (ii)
(b)Only (i) and (iii)
(c)Only (ii) and (iii)
(d)(i), (ii) and (iii)

Ans – d
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Q55. M3 is also known as ......

(a)Reserve Money
(b)Narrow Money
(c)Broad Money
(d)None of the above

Ans – c

Q56. Market demand curve obey the ......

(i) law of downward-sloping demand, (ii) law of upward- sloping demand
(a)Only (i)
(b)Only (ii)
(c)Either (i) or (ii)
(d)Both (i) and (ii)

Ans - a

Q57. ABC's Furniture Company sells industrial furniture for office buildings.
During the current year, it reported
cost of goods sold on its income statement of 10,00,000. ABC's beginning
inventory was 30,00,000 and its ending
inventory was 40,00,000. ABC's turnover is ...... times.
(a) 0.25
(b) 0.29
(c) 0.33
(d) 0.37

Ans - b

Q58. Cash = Rs. 6,00,000

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Debtors = Rs. 9,00,000 Inventories = Rs. 20,00,000 Current liabilities =

Rs.30,00,000
Total current assets = Rs. 40,00,000 The quick ratio =?
(a) 1:1
(b) 1.5:1
(c) 1:1.5
(d) 2:1

Ans – c

Directions (59-61): From the following information, calculate... Inventory in the

beginning =18,000
Inventory at the end =22,000
Net purchases = 46,000 Wages = 14,000
Revenue from operations = 80,000 Carriage inwards =4,000

Q59. Cost of Revenue from Operations

(a) Rs. 20,000
(b) Rs. 40,000
(c) Rs. 60,000
(d) Rs. 80,000

Ans - c

Q60. Average Inventory

(a) Rs. 20,000
(b) Rs. 40,000
(c) Rs. 60,000
(d) Rs. 80,000

Ans - a

Q61. Inventory Turnover Ratio

(a)1 Time
(b)2 Times
(c)3 Times
(d)4 Times

Ans - c

Directions: The top management of ABC Bank was in a triumphant mood after
engaging XYZ Ltd, one of the top IT Companies as a consultant for a massive
technology upgradation in the Bank. Their enthusiasm was short lived, as
the project did not progress well, and the consultants were not able to deliver
the desired results even after several months. In fact, the Consultants were of
the view that it may never be possible to implement the project with 100%
success as they seemed to be facing resistance from the employees at multi-
levels. The employees at all levels seemed reluctant to cooperate. Their fear of
Role erosion seemed palpable.
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Q62. What does “Role erosion” mean in this context?

(a)The fear of the employee that he will be sent out
(b)Fear that the responsibility and the power will reduce
(c)Fear that he will no more be an indispensable
(d)a & b

Ans - d

Q63. The critical issue in this case is:

(a)Attitudes of individuals
(b)Training of people
(c)Group behavior due to a sense of the unknown
(d)All the above

Ans - c

Q64. How could this situation have been managed better?

(a)By issuing project details and time frame mentioning punishments in case of
delay
(b)By roping in the HR professionals to act as coordinator
(c)By recognizing that any change brings its own reactions and co-opting the
managers even before Consultants moved in
(d)b & c

Ans - d

Q65. The Bank should deal with the employee resistance by:
(a)Co-opting the employees
(b)Communicating strategically about the potential benefits
(c)Conducting simultaneous training to familiarize the staff with the new
software
(d)All of the above

Ans - d

Directions[66-67] Consider the following data, for a given firm: Total assets - 1
Crore
Current assets - 40 Lakhs Current liabilities - 35 Lakhs
Long-term debt(book) - 50 Lakhs
Total stockholders' equity(book) - 15 Lakhs Retained earnings - 10 Lakhs
Sales - 1.5 Crores
EBIT - 8 Lakhs
Market value of equity - 30 Lakhs

Q66. Compute Altman's Z-score for this firm

(a) 1.4782
(b) 1.7482
(c) 2.4782
(d) 2.7482

Ans - c
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Q67. In economics, who gave the theory of wealth?

(a)Adam Smith
(b)Robin
(c)J.N.Keyens
(d)Alfred Marshal

Ans - a

Directions[68-77]: Summary of a Balance sheet of XYZ Company

Current Liabilities (In Crores) Current Assets (in Crores)
Cash Credit 3200 Cash 5000
Trade Creditors 9500 Inventory 14000
Other Current Liabilities 2000 Debtors 4200
Other Current Assets 2000

Total Current Liabilities 14700 Total Current Assets 25200

Q68. Current Ratio

(a) 1.61
(b) 1.71
(c) 1.81
(d) 1.91

Ans - b

Q69. Acid-Test Ratio

(a) 0.71
(b) 0.76
(c) 0.81
(d) 0.86

Ans – b

Q70. Net Working Capital

(a) 10000
(b) 10500
(c) 11000
(d) 11500

Ans – b

Q71. Working Capital Gap

(a) 12700
(b) 13200
(c) 13700
(d) 14200
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Ans – c
Q72. MPBF as per Tandon Committee - Method-I
(a) 10275
(b) 10775
(c) 13700
(d) 17300

Ans - a

Q73. MPBF as per Tandon Committee - Method-II

(a) 6200
(b) 6700
(c) 7200
(d) 7400

Ans – d

Q74. Current Ratio as per Tandon Committee - Method-I

(a) 1.01
(b) 1.06
(c) 1.11
(d) 1.16

Ans - d

Q75. Current Ratio as per Tandon Committee - Method-II

(a) 1.07
(b) 1.09
(c) 1.23
(d) 1.33

Ans – d
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Q76. Borrowing by the way of Cash Credit when compared with Tandon
Committee - Method-I
(a) 7025
(b) 7075
(c) 7125
(d) 7175

Ans – b

Q77. Borrowing by the way of Cash Credit when compared with Tandon
Committee - Method-II
(a) 4200
(b) 4600
(c) 5000
(d) 5400

Ans – a

Directions (78-83): From the following balance sheet of ABC Co. Ltd. as on
March 31, 2021. Calculate ......

Q78. Current assets

(a) Rs. 2,00,000
(b) Rs. 5,00,000
(c) Rs. 7,00,000
(d) Rs. 15,00,000

Ans – c

Q79. Current liabilities

(a) Rs. 2,00,000
(b) Rs. 5,00,000
(c) Rs. 7,00,000
(d) Rs. 15,00,000

Ans – b
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Q80. Working Capital

(a) Rs. 2,00,000
(b) Rs. 5,00,000
(c) Rs. 7,00,000
(d) Rs. 15,00,000

Ans – a

Q81. Debt
(a) Rs. 2,00,000
(b) Rs. 5,00,000
(c) Rs. 7,00,000
(d) Rs. 15,00,000

Ans – b

Q82. Equity
(a) Rs. 2,00,000
(b) Rs. 5,00,000
(c) Rs. 7,00,000
(d) Rs. 15,00,000

Ans – d

Q83. Debt equity ratio

(a) 1 : 0.33
(b) 1 : 0.5
(c) 0.33 : 1
(d) 0.5 : 1

Ans – c

Q84. What is Real GDP?

(a)GDP at Constant Price
(b)GDP at Current Price
(c)GDP at Today’s Price
(d)GDP at Variable Price

Ans - a

Q85. Which is the most frequent method in India, of calculating

inflation?
(a)Consumer Price Index
(b)Food Inflation Index
(c)GDP Deflator
(d)Wholesale Price Index

Ans - d
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Q86. Find odd one out ......

(a)Cyclical Trend
(b)Dependent Variable
(c)Seasonal Variation
(d)Secular Trend

Ans - b

Directions (87-89): Given the following data (Rs. in Arab) about a government
budget Capital Receipts Net of Borrowings 95
Revenue Expenditure 100
Interest Payments 10
Revenue Receipts 80
Capital Expenditure 110

Q87. Find out the Revenue deficit

(a)Rs. 20 Arab
(b)Rs. 25 Arab
(c)Rs. 35 Arab
(d)Rs. 40 Arab

Ans - a

Q88. Find out the Fiscal deficit

(a)Rs. 20 Arab
(b)Rs. 25 Arab
(c)Rs. 35 Arab
(d)Rs. 40 Arab

Ans - c

Q89. Find out the Primary deficit

(a)Rs. 20 Arab
(b)Rs. 25 Arab
(c)Rs. 35 Arab
(d)Rs. 40 Arab

Ans - b

Directions [90-92]: Based on the above information on sale of motor-bikes,

answer the following situation?
Situation Price Quantity demanded Quantity Supplied
A 80000 1550000 2770000
B 70000 1980000 2490000
C 65000 2250000 2250000
D 60000 2600000 1940000
E 50000 3000000 1650000
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Q90. What will be state of the market and what type of pressure will be there on
the prices of the motor-bike for situation - A or B?
(a)the market is having surplus supply and there will be reduction in price
(b)the market is having surplus supply and there will be increase in price
(c)the market is having short supply and there will be reduction in price
(d)the market is having short supply and there will be increase in price

Ans - a

Q91. What will be state of the market and what type of pressure will be there on
the prices of the motorbike for situation - D or E?
(a)the market is having surplus supply and there will be reduction in price
(b)the market is having surplus supply and there will be increase in price
(c)the market is having short supply and there will be reduction in price
(d)the market is having short supply and there will be increase in price

Ans - d

Q92. What is equilibrium price, demand and supply in the given problem?
(a)equilibrium price is Rs.70000 and demand and supply 1980000 units
(b)equilibrium price is Rs.65000 and demand and supply 2250000 units
(c)equilibrium price is Rs.50000 and demand and supply 3000000 units
(d)information is inadequate. No conclusion is possible

Ans - b
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Directions [93-96]: Answer the below questions from the table Items % Change
in Price % Change in Qty Demanded Elasticity Demand for salt 20 -1 X Demand
for Bananas 15 Y -3 Supply of chicken Z 14 1

Q93. The value of X......

(a) -20
(b) -0.05
(c)-1
(d)None

Ans - a

Q94. The value of Y ......

(a)-5
(b)15
(c) -45
(d) -3

Ans - a

Q95. The value of Z......

(a)14
(b)1
(c) 007
(d) 5

Ans - a

Q96. Project loans can be given by the bank to ......

(a)Only corporates
(b)Only corporates and partnership firms
(c)Only corporate, partnership firms and societies
(d)Any business entity

Ans - d
Directions [97-100]: The current ratio is 2 : 1. State giving reasons which of the
following transactions would improve, reduce and not change the current ratio:

Q97. Payment of current liability

(a)Improve
(b)Reduce
(c)No change
(d)None of the above

Ans - a
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Q98. Purchased goods on credit

(a)Improve
(b)Reduce
(c)No change
(d)None of the above

Ans – b

Q99. Sale of a Computer (Book value: Rs. 4,000) for Rs. 3,000 only
(a)Improve
(b)Reduce
(c)No change
(d)None of the above

Ans - a

Q100. Sale of merchandise (goods) costing Rs. 10,000 for Rs. 11,000
(a)Improve
(b)Reduce
(c)No change
(d)None of the above

Ans – a

Q101. In the Keynes model, which is independent:

a) Investment
b) Consumption
c) National income
d) Consumption and investment
Ans: a

Q102. How many motives for demanding money have been given by Keynes:
a) 1
b) 2
c) 3
d) 4
Ans: c

Q103. Recession is associated with falls in:

a) Demand
b) Supply
c) Disinvestment
d) Investment
Ans: a

Q104. Devaluation means:

a) Fall in Marginal utility of Money
b) Fall in the printing of currency
c) Risk in black money
d) Fall in the value of money in terms of foreign currency
Ans: d
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Q105. Acute inflationary situation:

a) Makes savings in the form of bank deposits less attractive
b) Makes savings more attractive
c) Arises due to liquidity trap
d) All the above
Ans: a

Q106. Microeconomic theory studies how an economy determines.

a) The price of goods
b) The price of services
c)The price of economic resources
d) All of the above.
Ans: d

Q107. A producer's positively sloped supply curve for a commodity represents.

a) In one sense a maximum and in another sense a minimum boundary of the
producer's intentions.
b) A maximum boundary of the producer's intentions.
c)A minimum boundary of the producer's intentions.
d)None of the above.
Ans: a

Q108. The theory of distribution refers to:

a)The distribution of income among various factors of the production.
b)The distribution of income among different individuals in the economy.
c)Both of the above
d)None of these
Ans: a

Q109. Interest is a reward for parting with liquidity according to:

a) B. Ohlin
b) Von Haberler
c) J.M. Keynes
d) Alfred Marshall
Ans: c

Q110. Economics may be divided into macro-economics and micro-economics.

Among the subject matter of microeconomics may be found:
a)The nature of value in exchange.
b)The size of a country's national income
c)The allocation of resources among competing uses
d) The relative prices of specific services.
Ans: d

Q111. The term "balance of trade" means:

a) Difference between exports & imports
b) Net Exports including merchandise
c) The difference between the cost of the imports and exports of a country.
d) a and c
Ans: d
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Q112. The open market operations refer to the sale and purchase by the RBI of:
a) Foreign exchange
b) Gold
c) Government securities
d) All the above
Ans: d

Q113. At the full employment level, which of the following would be most likely
to lead to inflation?
a) A fall in taxation with no changes in government expenditure
b) An increase in productivity without any increase in wages
c) A fall in investment with no change in prosperity for consumers
d) A rise in the prosperity to save with no change in investment
Ans: a

Q114. Deflation is:

a) Deficit budget
b) Reduction in taxation
c) Contraction in the volume of money or credit that results in a decline in the
price level
d)Increase in public expenditure
Ans: c

Q115. Bank rate means:

a) Interest rate charged by moneylenders,
b) Interest rate charged by the scheduled banks
c) Rate of profit of the banking institution
d) The official rate of interest charged by the central bank of the country
Ans: d

Q116 Which of the following does the term 'linear' represent?

a: drawing lines to solve a management issue
b: straight-line illustration of connections
c: use statistical approaches to solve a manufacturing problem
d: using straight lines to illustrate the solution.
Ans: b

Q117. Linear programming is a _______technique:

a: algebraic
b: mathematical
c: economics
d: any of the above
Ans: b

Q118. In linear programming, linear expression is known as:

a: main function
b: objective function
c: algebraic function
d: linear function
Ans: b
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Q119. Regular repayment in the form of interest on a bond is called:

a: discount,
b: interest
c: coupon
d: dividend
Ans: c

Q120. On an 8%, 5 year bond of Rs.10000, the investors get annually, as

a. 80.00, interest,
b. 800.130, discount,
c. 80.00, coupon
d. 800.00, coupon
Ans:

Q121. A bond the value of which is changed into a share is called:

a. convertible bond,
b. zero-coupon bond,
c. negative bond,
d. floating-rate bond
Ans:

Q122 Greater the value of r

a: better are the estimates obtained through regression analysis
b: worst are the estimates
c: makes no difference
d: none of the above
Ans: a

Q123 When one regression coefficient is negative, the other would be:
a: negative
b: positive
c: zero
d: none of the above
Ans: a

Q124. Value of correlation coefficient is:

a: 4bxy and byx
b: or - bxy and by:c
c: none of the above
Ans:

Q125. Non-random sampling occurs when things are included in a sample based
on the judgement of the person selecting the sample. (True/False)
Ans: True

Q126. Money has a time value is shown by which of the following concepts:
a: market value
b: face value
c: present value
d: b and c
Ans: c
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Q127. The cash inflow is called:

a: negative cash flow
b: positive cash flow
c: balanced cash flow
d: b or c
Ans: b

Q128. The cash outflow is known as :

a: negative cash flow
b: positive cash flow
c: balanced cash flow
d: a or c
Ans: a

Q129. A cash flow of the future has less value due to which of the following
(which is not correct):
a: present consumption is preferred over future consumption
b: money value gets eroded due to inflation
c: receipt of cash in future is subject to uncertainties
d: none of the above
Ans: d

Q130. The process through which the future cash flows are adjusted is called:
a: discounting
b: compounding
c: balancing
d: any of the above
Ans: a

Q131. Is there any system, by which resistance to change can be reduced?

a) by dose monitoring and guidance
b) by the success achieved by those who innovate being made known to others
c) both (a) (b)
d) Resistance can not be reduced
Ans: c

Q132. When a superior uses his/her authority to make decisions and announces
what he/she expects from others is called-
a) Unilateral approach to change
b) Shared approach to change
c) Delegation approach to change
d) Shared and delegated approach to change
Ans: a

Q133. In group discussions, in which groups are given wide latitude to diagnose
problems or to choose from alternatives is called___approach to change
a) Unilateral
b) Shared
c) Delegation
d) All above
Ans: b
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Q134. An approach to change which emphasizes the subordinates reaching

decisions, on their own is called-
a) Delegation
b) Shared
c) Unilateral
d) Both (b) (c)
Ans: a

Q135. What is required to be done, when change management helps an

organisation to stay on top of changes by-
a. Building resilience
b) Focus on critical issues and avoid energy description
c) Anticipate opportunities to become more competitive and manage in a climate
of uncertainty,
d) Only (a) (c)
e) All above
Ans: e

Q136. The main activities of change management are-

a. Filtering changes/managing changes/management reporting
b) Reviewing and closing requests for change
c) All above
d) Providing management information
Ans: c
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Q137. There are various conditions for change management. Tick minimal 3
such conditions :
a. Ability to notice weaknesses/top management commitment with a grant of
services/appointment of staff non-renewable period
b. Monitor changes at specific stages/experience of early success/ no deal in the
context of the local situation,
c. Trust and candour rest with juniors/ensure non-diversion of direction under
day to day work/staff to oversee the implementation
d. All above
Ans: a

Q138. For Total Quality Management (TQM) the required qualities are:-
a. Understand customer's current and future needs/leaders establish unity of
purpose/involvement of people for organisation's benefit
b. achievement of desired results when resources and activities are managed as
a process and (a) above
c. Mutually beneficial suppliers relationships enhance the ability to create value
and (b) also
d. Should have a temporary objective of the organisation
Ans: c

Q139. What management systems are available for TQM?

a) Organisational management system
b) Human resource management system
c) Total quality management system
d) All above
Ans: d
Q140. Business Process Re-engineering is all about-
a. Searching for new/business process
b. Implementation of new/business process to achieve breakthrough results (a)
above
c. Fundamentals rethinking and radical redesign of business process (b) above
d. It involves, going back to the beginning and forgetting the earlier growth
Ans: c

Q141. The general functional areas of personnel can be grouped

a. determining the staffing/measuring performance and developing potential
b. maintaining effective personnel management relationships
c. anticipating and coping with organisational changes
d. All above
e. Both (a) (b)
Ans: d

Q142. The role of HRD personnel is to-

a) description of the entire process/analytical decomposition
b) identification of HRD elements and resources
c) Both (a) (b)
d) Analytical decomposition only
Ans: c
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Q143. The primary goal of HRD is-

a. To increase the productivity of workers/and organisational profitability
b. Improve workers' skills and enhance motivation, to prevent obsolesces at all
levels
c. prevent obsolescence and increase organisational profitability only
d. Both (a) ± (b)
Ans: d

Q144. To achieve, workers increased productivity and organisational profitability,

the role of an HRD manager is-
a) to assist employees in obtaining knowledge/skills
b) to play enabling role in providing the right context
c)Intervention on individual and organisational effectiveness
d) Both (a) and (b)
e) All above
Ans: e

Q145. There are various roles of an HRD officer as per the American Society for
Training and Development. Which are 3 important among them?
a. Administrator's/evaluator's/career development advisor
b. Supporting individual's work/managing staff, unions discussion/ watching
organisational behaviour
c. Leader's/facilitator's/provider of instructional material from management's
role
d. Needs analysat's/organisational's change/basing decisions on traditional
method's roles.
Ans: a

Q146. Which statute governs credit management for statutory corporations?

a) Indian trust act and public act
b) Indian partnership act
c) Act that created them
d) Company act
e) Indian contract act
Ans: c

Q147. Which of the following is not a non-funding credit?

a) Derivatives
b) Forward contract
c) Co-acceptance of bills
d) Bill discounting
e) Letter of credit
Ans: d
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Q148. Mr Shyam lives in a small area not far from Agra. His home is rather
ancient and required some maintenance. So, Mr Shyam went to the Agra main
branch for a loan. What is the amount of bank loan he may get under housing
finance?
a) 20 lakh
b) 10 Lakh
c) 5 Lakh
d) 2 Lakh
e) 1 Lakh
Ans: e

Q149. Small business advances and export credit are not financed by both the
public and private sectors (export does not fall under priority sector advance).
What proportion of small business advances and export credit is expected to be
granted is __ and ___, respectively?
a) 10% and no target
b) No target and 12%
c) 10 and 12%
d) 18 and 10%
e) 40 and 32 %
Ans: c

Q150. The RBI will lift the cap on scheduled commercial banks' landing rates for
lending limits above ___.
a) 25 Lakh
b) 02 Lakh
c) 20 lakh
d) 01 Lakh
e) 05 Lakh
Ans: b