Financial Market Quiz-1

Financial Market Quiz-1

Quiz

 

1. Which of the following is not a financial market function?
   1.   Price determination of securities
   2.   Floating of companies
   3.   Lowering transaction cost
   4.   Mobilisation of savings
2. When the Securities and Exchange Board of India inspects a stock exchange, one of the most prevalent irregularities found is that the exchange is dealing with unregistered sub-brokers. Determine the Securities and Exchange Board of India’s associated function.
   1.   Regulatory function
   2.   Protective function
   3.   Developmental function
   4.   None of the above
3. The stock exchange assigns a number to each transaction, which is printed on the contract note. It is called-
   1.   PAN Number
   2.   Unique order code
   3.   Contract note
   4.   None of the above
4. It functions as a bank, storing securities in electronic form on behalf of investors-
   1.   Depository participant
   2.   Depository
   3.   Stock exchange
   4.   None of the above
5. Which of the following claims about financial markets is correct?
   1.   They serve as a link between households that save money and businesses that invest it.
   2.   They act as a link between savers and investors by facilitating the transfer of funds.
   3.   They invest the money they have available in their most profitable investment option.
   4.   All of the above
6. SEBI is the regulating body of-
   1.   Money market
   2.   Commodity market
   3.   Capital market
   4.   Overseas market
7. Raj was reluctant to buy stock in the stock market since he had heard that it is a location where various malpractices occur. He chooses to speak with a friend Narayan about the situation, who explains how SEBI protects investors’ interests. In the following scenario, determine the type of SEBI function.
   1.   Protective function
   2.   Regulatory function
   3.   Both of the above
   4.   Development function
8. Which of the following claims about Call money is not correct?
   1.   It is a short-term loan that can be repaid on demand.
   2.   It has a maturation period of one to fifteen days.
   3.   Call rates and other short-term money market products have a direct relationship.
   4.   Inter-bank transactions are carried out using it.
9. SEBI is serious about training intermediaries and deciding their code of conduct, according to an article published in a magazine. There has been a lot of research in several relevant fields, and the knowledge that is valuable is being published so that various individuals can benefit from it. In the following scenario, determine the type of SEBI function.
   1.   Regulatory function
   2.   Developmental function
   3.   Protective function
   4.   None of these
10. When a corporation needed money, it turned to facilities and institutional arrangements for long-term funds (debt + equity) to be raised and invested. There was a lot of debate over whether the company should have gone with debt or stock. Finally, it made the decision to pursue equity. The company’s owner made the decision to follow SEBI requirements. Which financial market principle is highlighted at the start of the case?
    1.   Money market
    2.   Stock exchange
    3.   SEBI
    4.   Capital market
11. It’s a market for short-term funds that deal in monetary assets with a one-year maturity period.
    1.   Primary market
    2.   Secondary market
    3.   Capital market
    4.   Money market
12. The RBI sells Naman a financial asset. This financial asset is a short-term borrowing instrument. He bought it because he doesn’t want to take any risk and wants a guaranteed profit. A promissory note is a type of financial instrument. It’s a very liquid substance. Zero-Coupon Bond is another name for this instrument. T-65 is inscribed on this instrument.
    In the example above, which financial asset is mentioned?
    1.   Call money
    2.   Treasury bills
    3.   Commercial paper
    4.   Commercial bill
13. Which of the following statements about the capital market is false?
    1.   The funds are only raised for a limited time.
    2.   It is possible to raise both debt and equity financing.
    3.   It is divided into two categories.
    4.   All of the above
14. Which of the following statements about the stock exchange is false?
    1.   It acts as a marketplace for the purchase and sale of new securities.
    2.   It reduces the securities’ marketability.
    3.   It increases the liquidity of the securities by offering a ready market.
    4.   It acts as a marketplace for the purchase and sale of old securities.
15. It acts as a link between the investor and the depository, which is authorized to keep track of dematerialized shares’ accounts.
    1.   Depository participant
    2.   Depositary
    3.   Stock exchange
    4.   None of the above
16. Which of the following is not a stock exchange’s protective function?
    1.   Fraudulent and unfair business activities are prohibited.
    2.   Keeping an eye on insider trading.
    3.   Companies’ takeover proposals are regulated.
    4.   Fair practices and a code of behavior in the securities industry are promoted
17. Asweon Ltd. wants to buy treasury bills for Rs.125,000. What is the maximum number of Treasury Bills that this fund can purchase?
    1.   5
    2.   6
    3.   7
    4.   8
18. This form of primary market floatation involves requesting subscriptions from the general public to participate in a company’s securities through the publication of advertisements-
    1.   Private placement
    2.   Offer through a prospectus
    3.   Offer for sale
    4.   All of the above
19. The exchange will deliver the stock or make payment to the other broker on this day-
    1.   Transaction day
    2.   Same day immediately
    3.   Pay-in day
    4.   Pay-out day
20. Which of the following statements about the money market is false?
    1.   It has a low market risk.
    2.   It is located in specific areas.
    3.   Deals in short-term and unsecured debt products.
    4.   The instruments that are traded are quite liquid.