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d) Private corporations
1. What does a well-established
financial system consist of?
a) Only financial institutions
b) Only financial markets
c) Financial institutions, financial
markets, financial instruments, and
financial services
d) Only financial instruments
2. What is the primary role of the
Reserve Bank of India (RBI) in the
Indian money market?
a) Lending long-term funds to the
government
b) Regulating and controlling the
credit supply
c) Providing loans to individuals
d) Issuing corporate bonds
3. Which of the following is part of
the unorganised sector in the Indian
money market?
a) State Bank of India
b) Nationalised banks
c) Moneylenders
d) Regional Rural Banks
4. What are Treasury bills used for in
India?
a) Long-term financial
requirements of the government
b) Short-term financial
requirements of the government
c) Providing loans to the public
d) Funding private corporations
5. What is the most important
component of the organised money
market in India?
a) Commercial paper market
b) Treasury bill market
c) Call money market
d) Collateral loan market
6. Who issues regular Treasury bills
in India?
a) Commercial banks
b) State governments
c) Reserve Bank of India on behalf
of the Central Government
1 BPS INSTITUTE, SCO – 140 FF, CHOTTI BARADARI, PATIALA. CALL – 94179 – 23412, 79868 -45967.
7. What type of market deals in
commercial bills issued by firms
engaged in business?
a) Call money market
b) Commercial bill market
c) Treasury bill market
d) Certificate of deposit market
8. What instrument was introduced
by the Reserve Bank of India in
March 1989 to widen the range of
money market instruments?
a) Commercial bills
b) Treasury bills
c) Certificates of Deposit (CD) and
Commercial Papers (CP)
d) Gilt-edged securities
9. Which of the following is NOT a
feature of the call money market?
a) Deals in call loans or call money
granted for one day
b) Mainly participates by banks
c) High stability in interest rates
d) Sensitive and competitive
market
10. Which market deals with long-
term finance (more than 365 days)
funds?
a) Money market
b) Capital market
c) Call money market
d) Commercial bill market
1. What do corporate securities refer
to?
a) Bonds and government securities
b) Stocks, shares, and debentures of
companies
c) Real estate properties
d) Commodities like gold and
silver
2. When was the National Stock
Exchange (NSE) set up?
a) 1984
b) 1988
c) 1992
d) 2002
3. What is the primary purpose of the
secondary market?
a) Issuing new securities
b) Providing liquidity to already
issued securities
c) Regulating financial institutions
d) Offering long-term loans
4. How many stock exchanges are
there in India, excluding the one
whose approval was withdrawn?
a) 20
b) 22
c) 23
d) 24
5. Which stock exchange became a
corporate entity known as BSE Ltd.
in 2005?
a) National Stock Exchange
b) Bombay Stock Exchange
c) Over the Counter Exchange of
India
d) Interconnected Stock Exchange
of India
6. What is the primary role of SEBI?
a) To provide loans to small
businesses
b) To regulate the Indian capital
market
c) To issue treasury bills
d) To manage foreign exchange
reserves
7. When was SEBI made a statutory
body?
a) 1988
b) 1992
c) 1995
d) 2000
8. Which was the first DFI
established in India?
a) IDBI
b) ICICI
c) IFCI
d) UTI
9. What does M1 measure include?
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a) Money with the public and term
deposits with banks 15. Which index includes 30 stocks
b) Currency notes and coins, and is known as the Sensex?
demand deposits of banks, and other a) BSE-200
demand deposits with RBI b) BSE-500
c) All deposits of post offices c) National Index
d) Saving bank deposits with post d) Sensitive Index
offices

10. What is the most important

component among all money stock
measures according to the RBI?
a) M1
b) M2
c) M3
d) M4

11. Which institution's main aim was

to give term loans in rupee and
foreign exchange?
a) LIC
b) IDBI
c) ICICI
d) IFCI

12. When did the Over the Counter

Exchange of India (OTCEI) begin to
trade?
a) 1989
b) 1992
c) 1995
d) 2000

13. What does the Industrial

Development Bank of India (IDBI)
assist through banks and State
Finance Corporations?
a) Large industrial units
b) Small and medium units
c) Non-banking financial
companies
d) Government agencies

14. What does M4 measure include?

a) M1 and saving bank deposits
with post offices
b) M3 and all deposits of post
offices
c) M1 and term deposits with
banks
d) Currency notes and coins only

2 BPS INSTITUTE, SCO – 140 FF, CHOTTI BARADARI, PATIALA. CALL – 94179 – 23412, 79868 -45967.