CSP-2015: Indian
Economy Test 2 dated: 15.12.2014
Instructions
1. Attempt all 100 questions.
2. All questions carry equal marks
3. Maximum marks:200
4. Time allowed: As per UPSC rules
5. Negative marking as per UPSC
rules
*****
1.
Which one of the following statements correctly describes “Willful defaulter”…
a. A company which has defaulted loan
payments to bank as its factory got burned down
and no money was able to be
generated to pay the dues
b. A unit of business failed to pay the
dues in spite of having funds at its disposal on
its own or among others concerns
under same management
c. A person filed IP petition as he
lost assets in the business
d. None of the above
2. Which of the
following describes the Insider Trading Correctly?
a. Trading in a publically traded firm by a person with specific inside information on
its affairs.
b. It is a trading with a view to improve
the general market conditions
c. It is a trading done with a varied
knowledge on the movements of the stock markets by
way of wide reading and experience on
capital markets
d. It is a trading done by the promoters
for promoting the welfare of the investors.
3. The
SEBI has finalized guidelines on the insider trading recently, on the basis of
recommendations of High Level
Committee to Review the SEBI (Prohibition of Insider Trading) Regulations, 1992
under the chairmanship of SN Sodhi. According to them, which one of the
following persons are not in the purview of the definition of “Connected
person”?
a. Employees or any other person who is associated with the company in
the past 6
Months, prior to the concerned
trade activity
b.
A
public servant or a person who occupies a statutory position that allows such
person access to “unpublished price sensitive information” relating to the
company
c.
Immediate
relatives of “connected persons” shall be deemed to be connected persons with
a right to rebut the presumption
d. The
employees who left the company an year before.
4. The terms ‘Marginal Standing Facility Rate’ and ‘Net
Demand and Time Liabilities’, sometimes
appearing in news, are used in relation to [CSP 2014]
a. Banking
operations
b. Communication
networking
c. Military
strategies
d. Supply
and demand of agricultural products
5. Consider the following statements?
1. The NBFCs are required to maintain CRR deposits with RBI.
2. RBI pays interest rates on CRR deposits.
3. Rationing of the credit would increase the liquidity in
the market
Which
of the above statements is or are true?
a.
Only 4 b. 1 & 2 c. None d. 1 & 4
6. Consider the following statements
1.
Nominal interest rate doesn’t take
inflation into account.
2.
Real interest rate takes inflation
into account.
Which of the above statements are
true?
a.
Only 1 b. Only 2 c. Both 1 and 2 d. Neither 1 nor 2
7. What is “base rate”?
a. It is the minimum rate of interest that a bank has to charge
from their customers.
b. It is the maximum rate of interest that a bank is
allowed to charge from their customers.
c. It is the interest rate at which loans are lent to most
important/prime customers
d. It is the rate set by RBI, not to lead loans to
customers.
8. In a futuristic society, if real interest rate became a
positive number, which of the following is most likely to be correct
options?
a. Fiscal deficit increased at the expense of current account deficit.
b. People have started putting their entire savings into gold.
c. RBI and Government failed in combating inflation.
d. RBI and government successfully managed to bring down inflation below
the
Nominal interest offered in banks.
9. Which of the following measures
would result in an increase in the money supply in economy? [CSP 2012]
1. Purchase
of government securities from public by central bank
2. Deposit
of currency in commercial banks by the public
3. Borrowing
by government from the central bank.
4. Sale
of government securities to the public by central bank.
Codes:
a.
Only 1 b. 2 and 4 c. 1 and 3 d. 2, 3 and 4
10. The RBI has prescribed ‘Fit and Proper’
criteria in its new guidelines for issue of banking licenses to
private sector during February, 2013. What does it mean?
A. The private firm/entities shall have
financially sound with a successful track record of 10 years with sound
credentials and integrity.
B. They should have been in banking
business for the past 10 years and has been doing business with integrity
C. The firm shall have Rs.500 crores
capitalization and good track record among its clients
D. The entity must be an NFBC and has
been in the finance business for the past 10 years
11. If
the interest rate is decreased in an economy, it will [CSP 2014]
(a) Decrease the consumption expenditure
in the economy
(b) Increase the tax collection of the Government
(c) Increase the investment expenditure in
the economy
(d) Increase the total savings in the
economy
12. Consider the following pairs
|
|
Nature
of advance from RBI
|
Meaning
|
|
1
|
Ways and Means advance
|
Excess utilization of funds by the
states than the
balances kept by them with RBI
|
|
2
|
Normal WMA
|
Un-secured advances to states from
RBI
|
|
3
|
Special WMA
|
Secured loan to states
from RBI
|
|
4
|
Over draft
|
Amounts drawn in
excess of WMA
|
Which of the above pairs
are correctly matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
13. Consider the following pairs
|
|
Nature
of the bank branch
|
Population
as per the latest census
|
|
1
|
Rural branch
|
More than 10,000 population
|
|
2
|
Semi-urban branch
|
More than 10,000 and less than 1
lakh
|
|
3
|
Urban branch
|
More than 10 lakh
population
|
|
4
|
Metropolitan branch
|
10, 00,000 and above
population
|
Which of the above pairs
are correctly matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 2 and 4 only
14. The RBI is regarded
as banker to the Government. Which of the following statement is not correct
from that perspective?
a. It performs all the banking functions
of the State and Central Governments.
b. It manages the public debt of the
Government.
c. It gives free loans to government
without any interest and time frame
d. It advices the Government on the matters
of economic and monetary policy.
15. Which of the
following statements describe the mutual fund correctly?
a. The money invested by the public in
the big corporate houses
b. An investment vehicle/house which
pools up money from the public and invest the
same in various equity and debt
instruments.
c. A group of people coming together and
pooling up the money and using the same for their
common and individual needs
d. It as a co-operative society operating
for the mutual benefit.
16. Which of the
statements describes the concept of “hedging” in the financial market
correctly?
a. Reducing or controlling risk of
losing the value of the stock by making an investment in
different kinds of stocks
b. Making an investment to reduce the risk of adverse price movements in an asset
c. Reducing the risk of losing money,
by buying different kinds of assets
d. Trading in futures market
17. Which of the following statements
are not true with regard to hot money?
a. They are the funds which are frequently
transferred between financial institutions or
Countries to make quick profits.
b. The money moves very quickly out of
the countries potentially leading to market
Instability and market crashes as
happened in South East Asia during 1997 and Russian
Crisis in 1998.
c. Some forms of hot money are Short-term foreign portfolio
investments, including
Investments in equities, bonds, and financial derivatives,
Short-term foreign bank loans &
Foreign
bank loans with short term investment horizon
d. Hot money has a major role in Foreign Direct Investment also.
18. What is Red Herring Prospectus in
the operation of Financial Markets?
a. It is a prospectus supplied to the
public by the companies going for IPO.
b. It contain the complete details and
price rate at which stocks are offered for sale under Initial Public Offer
c. It is called red herring because of
the bold disclaimer in red on the cover page of
the preliminary prospectus
d. It a preliminary
prospectus filed by a company with the SEBI usually in connection with the
company’s initial public offering.
19. Consider the following pairs
|
|
Types
shares/loan
|
Meaning
and/or effect
|
|
1
|
Common stock or
ordinary shares
|
Securities
that represents ownership in a corporation with voting rights
|
|
2
|
Preference shares
|
Shares
without voting rights, but entitled for specified dividends and have precedence
at the time of liquidation.
|
|
3
|
Debentures
|
An un-secured medium-
to long-term debt instrument used
by large companies to borrow money
|
|
4
|
Private placement
|
Select individuals to
whom shares are offered for sale.
|
Which of the above pairs
are correctly matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
20. Consider the following pairs
|
|
Country
|
Name
of the stock exchange
|
|
1
|
Brazil
|
BM and F Bovespa
|
|
2
|
Honk Kong
|
Strait Times
|
|
3
|
South Africa
|
JSE Ltd
|
|
4
|
Singapore
|
Hang Seng
|
Which of the above pairs are correctly
matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
21. Consider the following statements:
The price of any currency in
international market is decided by the (CSP2012]
1.
World Bank
2.
Demand for goods/services provided by the
country concerned
3.
Stability of the government of the
concerned country
4.
Economic potential of the country in
question
Which of the statements given above are correct?
a. 1, 2, 3 and 4 b. 2 and 3 only c. 3 and 4 only d. 1 and 4 only
a. 1, 2, 3 and 4 b. 2 and 3 only c. 3 and 4 only d. 1 and 4 only
22. The basic aim of Lead Bank
Scheme is that [CSP 2012)
a. Big banks should try to open offices in each district
b. There should be stiff competition among the various nationalized
banks
c. Individual banks should adopt particular districts for intensive development
d. All the banks should make intensive
efforts to mobilize deposits
23. Which of the following statements
express the meaning of "teaser loans" by commercial banks?
a. The teaser loans carry low rate of interest in initial years and high
rates are
higher in later years.
b.
The teaser loans carry high rate of
interest in initial years and low interest rates are higher in later years.
c.
They offer very concessional rates of
interest
d.
None of the above.
24. The lowering of Bank Rate by
the Reserve Bank of India leads to (CSP 2011)
a) More liquidity in the market
b) Less liquidity in the market
c) No change in the liquidity in the market
d) Mobilization of more deposits by commercial banks
25.
What is the meaning of “Marginal Standing” under the “Marginal Standing
Facility” [MSG] offered by RBI to the Scheduled commercial banks [SCBs]?
a)
Bankruptcy
b) High ratio of bad debts
c)
High Liquidity position
d) Overnight Liquidity problem or urgent need for funds by SCBs
26. With
reference to India, consider the following: (CSP 2010)
1.
Nationalization of Banks
2.
Formation of Regional Rural Banks
3.
Adoption of villages by Bank Branches
Which of the above can be considered as steps taken to achieve the
"financial inclusion" in India?
a. 1 and 2 only b. 1 and 3 only c. 3 only d. 1, 2 and 3
a. 1 and 2 only b. 1 and 3 only c. 3 only d. 1, 2 and 3
27. Consider the
following statements
1. NABARD was established during 1982 on the recommendation of Shivaraman
Committee
and its headquarters is at Mumbai.
2. It is an apex development bank in India and deals with the
"matters concerning policy,
planning and operations in the field of credit for agriculture and other economic activities
in rural areas in India".
3. It is owned by the by the Government
of India & RBI at 99:1 ratio.
4. NABARD has no role in financial inclusion
Which of the above
statements are true?
a. 1, 2 & 3 b. 2, 3 & 4 c. 1, 2 & 4 d. All of the above
28.
"World Economic Outlook" report is published by—
a. IMF b. World Bank c. RBI d. UNCTAD
29.
Which of the following pairs is not correctly matched?
a. EXIM Bank—Financing
for export-import
b. RBI—Banker's bank
c. IDBI—Industrial
finance
d. IFCI—Financial assistance to commercial
institutions
30. The regulator of Micro Finance business in India is—
a. Securities and
Exchange Board of India [SEBI]
b. Reserve Bank of India [RBI]
c. Forward Market Commission [FMC]
d. None of these
31. Consider the following pairs
|
|
Printing
press
|
Products
made
|
|
1
|
Currency Note Press, Nasik Road
|
Lower
denominations except Rs.20 & Rs.50 & Rs.100
|
|
2
|
Bank
Note Press, Dewas
|
Rs.20 and above
denominations
|
|
3
|
Security
Printing Press, Hyd.
|
Postal stamps for
southern states
|
|
4
|
Security Paper,
Hoshangabad
|
Bank & currency
notes paper
|
Which of the above pairs are correctly
matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
32. What is the
most important effect of “buyback of shares” or shares repurchase by the
companies?
a. It would decrease the investment value of the individual share
holders
b. It enhances the investment value of the existing shareholders
c. It dilutes the shareholding
of the company involved in buyback of shares
d. It would increase the numbers of shares of a listed company.
33. The value of the stock market indices is measured in
terms of values of a group of stocks, but not all the listed companies. In this
connection, which of the following pairs are in-correctly matched?
|
1
|
BSE Index- Sensex
|
30 stocks
|
|
2
|
NSE Index- Nifty
|
60 stocks
|
|
3
|
MCX Index- SX40
|
40 stocks
|
Which of the above pairs are correctly
matched?
a. 1 & 2 b. 2 & 3 c. Only 2 d. 1, 2 & 3
34. Consider the
following pairs
|
|
Term in capital
market
|
Meaning
|
|
1
|
Retail
or Individual investor
|
An investor who applies or bids for securities of or for a
value of not more than Rs. 2,00,000 for their personal account.
|
|
2
|
Qualified
Institutional Buyers [QIBs]
|
Institutional investors who are perceived to possess expertise
and the financial strength to evaluate and invest in the capital markets, as
defined by SEBI.
|
|
3
|
High
Net Worth Investors [HNIs]
|
Individuals having
investable assets of $1 million and above
|
|
4
|
Institutional
investors
|
Organizations which invest in large
quantities of shares of insurance companies, pension and mutual funds etc.
|
Which of the above pairs are correctly
matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
35. BFSI means
a. Banking
of the Small scale Industries
b. Broad
Framework on the sick industries
c.
Beneficial Financial Sector of India
d. Banking,
Financial Services and Insurance.
36. Which of the following
gives the correct meaning of “Security Receipts” [SRs]?
a. They are securities issued by the
trusts, owned by the Asset Reconstruction
Companies [ARCs] as against the NPAs
purchased from the banks
b. SRs are assets under the management
[AUM] of ARCs given to the retail investors
c. SRs are money market instruments for
raising the capital by the corporate firms
d. SRs are money capital instruments for
raising the capital by the corporate firms
37. Banks, Financial
Institutions, Non-Banking Financial Companies, Housing Finance Companies and
Credit Card Companies use its services. It collects the data of loan
seekers from the loan grantors and provides Credit Information Reports [CIR] and
Individual Credit scores. This Institution, has recently has stated that it
will come with a “Risk Index” to help the banks and other financial
institutions in granting loans to corporate entities. Identify it?
a. SEBI b. RBI c. CIBIL d. Competition Commission of India
[CCI]
38. Which of the following statements are
true with regard to charging of withdraw of cash from ATMs by the RBI?
a. The number of free transactions has
been reduced to 3 from 5 in the non-home ATMs in
6 metros, Mumbai, Kolkata, New
Delhi, Chennai, Hyderabad and Bangalore.
b. The number of free transactions in
home ATMs is 5
c. The transactions in excess of 3 or 5
as the case may be would be charged by the banks
as per their wish in a transparent
manner, but not exceeding Rs.20/- plus taxes
applicable, per transaction.
d. All of them
39. What is “sbiINTOUCH”?
A. It is a digital banking initiative
brought out by SBI, to deliver best-in-class services
to the growing tech-savvy customer
base through its digital stores.
B. It is online services provided by the SBI
group banks
C. It is the widow created for facilitating
government payments
D. It is window made for creating new
accounts in PMs Jan Dhan Yojana
E. None of the above
40. Consider the following pairs
|
|
Name of the Country
|
Name of the domestic payment gateway
|
|
1
|
China
|
China Unionpay (CUP)
|
|
2
|
Australia
|
Eftpos (epal)
|
|
3
|
India
|
Rupay
|
|
4
|
Singapore
|
Network for Electronic Transfers
(NETS)
|
Which of the above pairs are correctly
matched?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
41.Which of the following is CORE
function/objective of the National Payments Commission of India [NPCI]?
a. To co-ordinate with the bankers for easy encashment of payments made
by
the customers.
b. To develop a nation-wide uniform and standard business process for
all retail
payment systems by consolidating and integrating the existing multiple
systems with varying service levels
c. to facilitate an affordable payment mechanism to benefit the common
man
across the country and help financial inclusion.
d. To compete with the visa and mastercard operating companies in the
World.
42. The President of India had
dedicated, “Rupay”, the Indian domestic card
payment network to the Nation during May, 2014. This was introduced by
the National Payments Commission of India on the lines of Chinese Unionpay,
Which work on three channels — ATMs, Point of Sales (PoS) and online sales. Which one of the following is a NOT
an effect of introduction of this gateway?
a. Reduce the transaction cost
b. Availability of services at a cost much
less than those of international cards such as
Visa, Mastercard etc.
c. Financial inclusion/Reach the unbanked
sections
d. Enhances the number of cash
transactions
43.
What is the meaning of 80:20 scheme of RBI on the gold imports and exports?
a. The Indian traders are allowed to import
only 80% of their entitled gold
b. Specific star trade houses are allowed
to import gold on the condition that
20% of the imported gold is exported as
finished products.
c. It is the allowable import share of gold
by star trading houses and five banks
respectively.
d.
None of the above.
44.
Which of the following statements are true with regard to Bharatiya Mahila Bank
(BMB)?
1. It is India’s first all-women
bank which serves only for female gender.
2.
Recently, it has been included in the second schedule to the RBI Act 1934.
3.
It offers loan to girl child at a concessional rate which is 1% lower than the
normal rates.
4.
It came to existence during Nov., 2013 with a seed capital of Rs 1,000 crore,
to take care of the banking needs of
women and promote their economic Empowerment.
a.
1, 2 & 3 b. 2 & 4 c. 2, 3 & 4 d. 1, 3 & 4
45.
What is the meaning of “Dual Currency Bonds”?
a. Bonds issued in the international
market for raising funds and interest is paid
in one of the 2 foreign currencies
whichever is beneficial to the investor.
b. The DCB pay interest coupons in one
currency and principal redemption for a
fixed sum in a second
currency, often the dollar
c. They are the bonds issued in India
as well as in a foreign country.
d. None of the above.
46.
One of the Indian states has reintroduced Bhamashah Financial Empowerment Scheme, (BFES) whereby the Government will
deposit Rs.1500/- into the savings accounts of 50 lakh rural families belonging
to Below Poverty Line (BPL), Small & Marginal Farmers and identified SC/ST
families. This scheme is on financial inclusion,
i.e., to provide banking service & health insurance services to the
targeted population. Identify the state?
a. Madhya Pradesh b.
Chhattisgarh c.
Rajasthan d. Kerala
47. The Budget 2014-15 has increased
the investment limit under section 80C of the Income Tax Act from Rs.1 lakh to
Rs.1.5 lakh. Similarly the investment limit in Public Provident Fund [PPF] has
been enhanced from Rs.1.0 lakh to Rs.1.5 lakh. Which of the following would NOT
be result of these proposals?
a. It promotes Savings
b. It reduces the quantum of tax
payable
c. It result into more liquidity in the market
d. It sucks the liquidity from the system.
48. Consider the following budget proposals
with regard to urban development in India
1. Development of 100 smart
cities with all civic facilities with an outlay of Rs.7060 crores
2. The minimum built up area
& capital to allow FDI in urban development is reduced from
50,000 Sq. mtrs to 20,000 sq. mtrs
and from USD 10 million to USD 5 million
respectively with a three year post
completion lock in.
3. The conditions of space and capital for allowing FDI are not
applicable for those urban
Housing projects which are
committing at least 30% of the total project cost for low cost
affordable housing
Which of the above statements are NOT true?
a. 1 & 3 b. 2 & 3 c. Only 3 d. All of them
49. Consider the following statements
1.
P-Notes are derivative instruments issued by registered FIIs to overseas
Investors such as
HNIs and hedge funds who wish to invest in the Indian Markets.
2.
The registered FIIs issuing P-notes are mandated to collect details of the real
beneficiary owners of funds to be invested through this route.
3. As per the latest norms of SEBI, the
P-notes are required have to registered
themselves with SEBI now.
Which of the above
statements are true?
a. Only 1 b. Only 1 & 2 c. 1 & 3 d. All of them.
50.
Consider
the following statements with regard to “shadow banking entities”
1. The shadow banking
entities are non-bank financial intermediaries that provide services similar to
traditional commercial banks
2. They borrow money in
the short term and take that money to invest in long-term assets
3. They don’t accept
deposits and stay away from the regulatory framework of the resident country.
4. As per the report of
the Switzerland-based
Financial Stability Board (FSB) growth rates of above business in India is
around 20 per cent since 2007.
Which of the above
statements are correct?
a. 1 and 2 b. 2 & 3 c. 1 & 3 d. All of them
51.
Consider the following statements on financial inclusion.
1. Covering rural poor in banking net.
2. Covering urban poor in banking net.
3. Providing jobs to poor people.
4. Providing vocational training to poor
people.
5. Spreading banking awareness among
poor people.
Which of the above statements is
part of the Financial Inclusion?
a. 1, 3 and 5 b. 1, 2 and 5 c. Only 3 d. All of them
52. Consider the following
organizations or concerns.
1.
Post office
2.
Panchayats
3.
NGO and Insurance Agents
4.
Self Help Groups (SHG)
Which of the above is/are eligible
to become Business correspondents for banks?
a.
Only 1 and 2 b. Only 2 and 4 c. Only 2 and 3 d. All of them.
53.
The Reserve Bank of India has proposed to designate certain banks as
domestic systemically important banks (D-SIBs) where their size as a percentage
of GDP equal to or more than 2 per cent and they will be subject to higher
capital requirements. In deciding the RBI has considered some the following
indicators.
1.
Size
2.
Interconnectedness
3.
Substitutability
4.
Complexity
5.
Cross Jurisdictional activity
Which
of the following indicators followed by RBI in deciding the D-SIBs?
a. 1, 2, 3 & 4 b. 1, 2, 3 & 5 c. 1,3,4 & 5 d. All of the above.
54. Consider the guidelines issued by
RBI on D-SIBs on the lines of guidelines issued by Basel Committee on Banking
Supervision [BCBS] for globally systemically important banks
(G-SIBs).
1. Higher capital requirements over and
above the Basel III norms are prescribed for these
Banks as they are too-big-to-fail.
2. These banks are classified under
five categories/buckets and have to achieve additional
Common
Equity Tier 1 capital, ranging from 0.2% to 1%.
3.
The higher capital requirements applicable to D-SIBs will be applicable
from April 1,
2016 in a phased manner and would
become fully effective from April 1, 2019.
Which of the above guidelines are
correct?
a.
1,
2 & 3 b. Only 2 c. Only 3 d. 1 & 2 only
55. Which of the following is not a
part of the Tier 1 capital of a bank?
a. Common equity or general shares of a bank
b. Disclosed reverses or retained profits in the balance sheet
c. Redeemable and cumulative preferred stock or shares
d. Non-redeemable non-cumulative preference shares.
56. Consider the
following statements.
1. They are nothing but Indian Depository
Receipts [IDRs] before the Union Budget, 2014-15
2. They are
introduced based on the recommendations of Sahoo Panel headed by MS
Sahoo,
Secretary, Institute of Company Secretaries of India.
3. BhDRs is an investment opportunities for
Indians to invest in the foreign companies,
operating
outside India.
4. They are
almost opposite to GDR/ADR issues where in the Indian companies raise money
from abroad.
Which of the above
statements are true with regard to Bharat Depository Receipts [BhDRs]?
a. 1, 2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
57.
There is a paradigm shift in the policy of RBI in granting bank licenses to the
aspirants during 2014. Which one of the following is the most appropriate
answer from the options given below?
a. Adoption of Basel III norms of BCBS.
b. Allowing the non-deposit taking NBFCs
to function as “Business Correspondents”
c. Granting licences for differentiated
banking such as payment bank and small banks.
d. Granting of bank licenses to the
aspirants on a regular basis.
58. What are the following are the features of “PMs Jan Dhan
Yojana?
a. A Saving
Bank [SB] account and debit card with Rs.5000/- over draft facility in due
course
b. It is no
frill account, i.e., no minimum balance is prescribed for the account and Rupay
card
c.
Rs.1,00,000/- accident cover and Rs.30,000/- additional life cover to the
Account
holder if the account is opened on or before republic day in Jan., 2015.
d. All of
them
59. Consider
the following functions of a facility.
1. To ensure that funds are blocked in
the bank account to the extent of shares applied
2. To ensure that funds are returned
in the case of non-allotment of shares
3. To ensure smooth handling of
purchase of shares under IPO/FPO etc.
4. To put rest to grievances of the
investors on refund of un-allotted amounts
Which of the
above are functions of Application Supported by Blocked Amount [ASBA] in IPO or
FPO or Rights Issue?
a. 1,
2 and 4 only b. 1 and 3 only c. 1, 2, 3 and 4 d. 1 and 4 only
60. What are
REITs?
a. Real Estate Infrastructure Trusts
b. Real Estate Investment Trusts
c. Rating of Entrepreneurs in Indian
Trade
d. Retail Entrepreneurs Investment
Training
61. Consider
the followings statements
1. They will provide suitable buyers for
the properties of real estate people or builders
2. These trusts have to buy the
completed commercial properties only
3. The main income of the trusts would
be by rent or interest
4. They have been given “pass through
status” in the budget and therefore they need not
pay tax on the interest or rent
earned by them.
Which of the following statements are true
with regard to REITs?
a. All
of them b. 2, 3 and 4 c. 1, 3 and 4 d. 1, 2 and 3
62. Which of
the following is not a derivative transaction?
A. Futures B. Call Option C. Put option D. Rights Issue
63. What is
“crowding out effect”?
a. Excess borrowings and spending by the
Govt. result in low investment by private
firms due to lack of credit
availability in the market
b. Excess spending by private firms
deprives Govt. for the resources towards public
spending
c. It is nothing but competition between
Govt. and private firms for funds
d. None of them
64.
The RBI has defined “Willful defaulter” and in that connection, consider the following
statements
1.
Default
in repayment of loans deliberately, in spite of having capacity to oblige
payments
2.
The
defaulter, has diverted the loan to some other purpose, other than for which it
was sanctioned by the bank
3.
The
defaulter, has siphoned off the funds and neither used the funds for the
specific purpose, nor the funds available with the unit in the form of others
assets
4.
The
defaulter has disposed-off the movable or immovable assets for which a term
loan was secured without the knowledge of the lender/bank.
Which of the above statements are
included in the definition of willful defaulter as per the RBI?
a. 1, 2 and 3 b. 1, 2, 3 and 4 c. 2, 3, and 4 d. None of the above
65. What is the meaning of angel
investors…?
a. Affluent individual who provides capital for a business start-up,
usually in
exchange for convertible debt or
ownership equity
b. Affluent investors who provide capital and guidance to start-up to
make high profits
c. A wealthy investors provide capital in high risky areas of business
to make quick gains
d. None of the above
66. What is meant by an “arbitrage”…?
a. The opportunity to buy an asset at a
low price then selling it leisurely on a different
time and market for a higher price.
b. Leveraging the price differential in the cash and derivatives market
to generate returns.
c. It is buying one type of asset and converting it into different form
and sells it for profit
d. None of the above
67. Consider the following
activities of Govt.
1. Providing tax incentives
2. Making GST legislation
3. Dilution of green laws to
promote investment
4. Reduction of interest rates
Which of the above is/are part of
the Monetary Policy of the Government of India?
a.
Only 4 b. 2 and 4 c. 1 and 4 d. 1, 2 and 3
68.
The “Open Market Operations” of RBI includes….
1. Buying of Govt. securities from the
public
2. Sale of Govt. securities to mop up
money from the market
3. Sale of the shares of Public sector
undertakings
Codes:
a. 1 and 3 only b. 2 and 3 only c. 1 and 2 only d. 1, 2 and 3
69.
The term “underwriting” is associated with, which of the following activity?
a. Issue of shares in the Primary
market
b. Issue of shares in the secondary
market
c. Issue of shares in both Primary and
secondary markets
d. Issue of shares in the recognized
stock exchanges of India
70.
Merchant banking means….
a. Providing banking facilities to the
big business houses in India
b. Banking plus consultancy services
such as financial, marketing, managerial &
legal etc.
c. Providing purely consultancy services
from starting of the business to its running…
d. Providing banking loans at a
concessional rates to MSME sector
71.
Consider the following pairs
|
|
Type
of Govt. Security
|
Purpose/Description
|
|
1
|
Cash
Management Bills
|
Temporary mismatches of Government of India’s cash flow
|
|
2
|
Treasury
Bills
|
Long
term money markets instruments with maturity period more than a year
|
|
3
|
Dates
Securities
|
Short term borrowing by the Central/State Govt.’s with
maturity period less than a year.
|
Which
of the above pairs are correctly matched?
a. Only 1 b. 1 and 2 c. 1 and 3 d. 1, 2 and 3
72.
Consider the following statements
1. “Commercial Paper” is an unsecured
promissory note or bond issued by India Inc. with
a
fixed maturity of not more than 270 days.
2. The
CPs with higher rating by the Credit Rating Agencies will give/offer more rate
of
Interest/return than those of with lower
rating.
Which of the above statements are true?
a. Only 1
b. Only 2 c. Both 1
and 2 d. Neither 1 nor
2
73.
What is the meaning of “Certificate of Deposit”..?
a. They are unsecured promissory bonds
for raising money from the public
b. Unsecured money market instrument
used by RBI to raise money for the Govt.
c. They are secured promissory bonds
issued by Scheduled Commercial Banks for
rising Money with maturity period
not less than a week and not more than a year
d. Secured money market instrument used
by RBI to raise money for the Govt.
74.
Consider the following statements
1. The allowable FDI limit in Scheduled
Commercial private banks is 74%
2. The allowable FDI limit in PSU banks
is 20%
3. 100 per cent foreign investment is allowed in asset reconstruction
companies [ARCs]
Which of the above statements are true?
a. Only 1 b. 1 and 2 c. 1 and 3 d. 1, 2 and 3
75.
Consider the following statements
1.
A business loan, both principal and interest unpaid beyond 90 days
2. A loan given to Small scale Industry
unpaid beyond one year
3. Unpaid agriculture loan [both
interest and principal] beyond 3 months
Which
of the above loans are to be categorized as Non Performing Asset by the
Scheduled Commercial banks?
a. 1 and 3 b. 1 and 2 c. 2 and 3 d. 1, 2 and 3
76.
Consider the following Non-performing asset pairs of a bank
|
|
Type
of NPA
|
Purpose/Description
|
|
1
|
Sub-standard
asset
|
Loan
which is remained as NPA for more than one year
|
|
2
|
Doubtful
asset
|
Un-recoverable
loans, though not written off in the books
|
|
3
|
Loss
asset
|
Loan
which is classified as NPA for a period not exceeding 1 year
|
Which
of the above pairs are correctly matched?
a. Only 1 b. 1 and 2 c. 1 and 3 d. None
77.
Which of the following acts as banker to the Central Banks?
a. Banking Committee on Basel
Supervision [BCBS]
b. The Bank for International
Settlements [BIS]
c. IMF
d. World Bank
78.
Which one of the following is not an objective of BCBS, headquartered at Basel,
in Switzerland?
a. Prudential regulation of banks and
providing a forum for co-operation on banking
Supervisory matters
b. Improve the
banking sector's ability to absorb shocks arising from financial and
Economic stress and thereby
achieve financial stability
c. To improve risk management and
governance, strengthen banks' transparency and
Disclosures
d. To enhance the profits of the
banking sector, so that Financial Inclusion is possible
79. Risk Weighted Assets [RWA]
means…
a. Total NPAs of the bank
b. Bank assets with special risks, weighted according
to exposure to different sectors and
different levels of possible default.
c. Bank loans which are given to high risk
areas such a real estate, credit cards etc.
d. None of the above
80. According to RBI, which of the
following assets of the bank are risk free and there is no need to treat them
as Risk weighted assets [RWA] and apportion a portion of capital for possible
default and loss from them?
a. Housing Loans
b. Government Approved Securities
c. Venture
Capital Investments
d. Loans against Jewellery
81.
Basel norms are …
a. A set of international banking prudential
norms and regulations
b. A set of norms for international
derivative transactions and markets
c. A set of capital market regulations
d. None of the above
82. Under the Basel III rules of BCBS, the
banks are required to hold 4.5% of common equity, as against 2% in Basel II and 6% of Tier I capital (including common equity) as against 4%
in Basel II of "risk-weighted
assets" (RWAs). In addition to this, Basel III norms include
certain new regulations which were not part of Basel II norms of BCBS.
Identify those new regulations from the options and codes given below?
1. A "mandatory capital
conservation buffer" of 2.5% of RWAs in
the form of common
Equity
Tier 1 capital.
additional
2.5% of capital during periods of high credit growth.
3. A leverage ratio of 3% to take care
of risks involved in the exposure to Derivative
Market
Codes:
a. Only 1 b. 1 and 2 c. 1, 2 and 3 d. None of the above
83.
Consider the following monetary policy instruments of RBI
1. Cash Reserve Ratio [CRR] and
Statutory Liquidity Ration [SLR]
2. Direct action and Moral
suasion
3. Marginal requirements and credit
rationing
4. Bank Rate and Open Market
Operations [OMOs]
Which of the above are Quantitative credit controls available
to the RBI?
a. 1 and 4
b. 1 and 3 c. 1 and 2 d. 1, 3 and 4
84. Consider the following
statements
1. There would be convergence of
capital providers [or owners] and loan seekers in the
Co-operative banks in India
2. In SCBs, there is no such
convergence of capital provides and loans seekers
Which of the above statements are true?
a.
Only
1 b. Only 2 c. Both 1 and 2 d. Neither 1 nor 2
85. Capital Adequacy Ratio [CAR] or "Capital to Risk Weighted Assets
Ratio (CRAR) is very important concept the financial world, which is used to protect
depositors and promote the stability and efficiency of financial systems. It is
a measure of a bank's capital. It is expressed as a percentage of a bank's
risk weighted credit exposures to its capital, both Tier 1 and Tier 2.
In this connection, consider the following
statements
1. Tier 1 capital can absorb losses
[suffered by bank] without a bank being required to cease
Trading. It provides highest degree
of safety to the investors/depositors in the bank.
2. Tier 2 capital can absorb losses in
the event of a winding-up and so provides a lesser
degree of protection to depositors.
a.
Only
1 b. Only 2 c. Both 1 and 2 d. Neither 1 nor 2
86. Consider the following items/components of capital of
a bank
1. Undisclosed reserves, Revaluation
reserves and General
Provisions and loss reserves
2. Redeemable Cumulative
preference shares and perpetual cumulative
preference
Shares
3. Hybrid debt capital
instruments such as bonds.
4. Sub-ordinated debt and/or Long term unsecured loans
5. Debt Capital Instruments.
Which
of the above qualify as Tier-2 capital of a bank?
a. 1, 2 and 3 b, 1, 2, 3 and 4 c. 1, 3, 4 and 5 d. 1, 2 ,3, 4 and 5
87.
Consider the following businesses/Non-Banking Finance Companies [Imp 4 CSP
2015]
1. Merchant
Banking Companies
2. Venture Capital Companies
3. Stock Broking companies and Mutual
Funds
4. Nidhi companies and Chit Fund
Companies
Which of the above businesses are
regulated and controlled by SEBI?
a.
1,
2 and 3 b, 1, 2, 3 and 4 c. 1, 3, and 4 d. 1 and 3 only
88.
Non-Banking Finance Companies [NBFCs] means
b. A company registered with RBI with
differentiated bank license
c. A company which is not involved
banking operations
d. None of the above
89. The RBI
has tightened the norms for the NBFCs to ensure stability and protection of
investors recently in a phased manner.
In this connection, consider the following
statements
1. The minimum net owned funds would
be Rs.2 crores for all NBFCs by 2017
2. Categorized them as Non-deposit
taking NBFCs with assets less than Rs.500 crore
and systemically important NBFCs
with assets of over Rs.500 crore
3. All Non-deposit taking NBFCs with
asset size of Rs.500 crore and above and all
deposit-taking NBFCs to maintain
minimum Tier-I capital of 10% by the end of March
2017
4. The time frame for treating assets
as NPA is made in tune with the banks (90 days)
for all non–deposit taking
systemically important NBFCs and deposit-taking NBFCs
5. Provision for standard assets for
non–deposit taking systemically important NBFCs
and Deposit-taking NBFCs
increased to 0.40%
Which
of the above statements are true?
a. 1, 2 and 3 b, 1, 2, 3 and 4 c. 1, 2 ,3, 4 and 5 d.1, 3, 4 and 5
90.
What is the main duty of Asset Reconstruction Companies [ARCs] in India?
a. Collection of dues from the NPAs
brought from the banks
b. Helping and advising the businesses
which created NPAs to bank in paying their dues
c. They are reconstructing the business
of the NPAs
d. None of the above
91.
The RBI has brought new guidelines for ARCs recently. In this connection,
consider the following statements
1.
The ARCs henceforth will have to pay upfront 15 per cent of the bid value of
non-
performing loans, against five per
cent earlier.
2. The ARCs which are planning to buy
bad loans will get more time (at least two weeks) to
carry out due diligence before
bidding for stressed assets.
3. The ARCs will get only up to six
months, instead of one year to plan recoveries from the
Non-performing assets acquired.
Which of the above
statements are true?
a.
1
and 2 b. 1 and 3 c. 1, 2 and 3 d. 2 and 3
92.
Derivatives in capital market means
a. The derivatives are contracts whose
value is determined by fluctuations in the
underlying asset
b. Derivatives are contracts where the
value of the assets is determined by the
appreciation in the value of
underlying asset
c. Derivatives are contracts where the
value of the assets is determined by the
depreciation in the value of
underlying asset
d. None of the above
93. Which of the
following is NOT a derivative transaction?
a. Futures
contracts
b. Forward
contracts
c. Options
[Call and Put options] and Swaps
d. Exchange traded funds
94.
Which of the following correctly describes the trading in
Futures?
a. Trading in original
securities/Indices of stock exchange or in Commodities
b.
A form of investment, speculating on the price of a security
going up or down in
future date
c. A complicated transaction
involving transfer of physical assets at the time of contract
d. Trading in future based on the
present value of stocks or commodities
95.
Consider the following class of people
1. Hedgers
2. Speculators
3. Long term investors in stock
market
4. Investors in Mutual Funds
Which
kind of the above class of investors generally deal/trade in Futures and
Options?
a. 1 and 2 b. 1 and 3 c. 1, 2 and 3 d. 1, 2, 3 and 4
96. It is an option
gives the buyer the right but not the obligation to buy a given quantity of the
underlying asset at a given price on or before a given future date. If the said
buyer can exercise the option and ask the seller to sell an underlying asset at
a cost as per the option agreement, irrespective of the market value of the
said asset on a particular date. Identify the name of the correct option
involved in this case from the choices given below.
a. Call
Option b. Put option c. Both Call and Put option d. Neither Call nor Put option
97. It is an option
gives the buyer the right but not the obligation to sell a given quantity of
the underlying asset at a given price on or before a given future date. The
said buyer of an option, can exercise the option and Sell the underlying asset
to the contractee at a cost as per the option agreement, irrespective of the
market value of the said asset on a particular date. Identify the name of the
correct option involved in this case from the choices given below.
a. Call
Option b. Put option c. Both Call and Put option d. Neither Call nor Put option
98.
Consider the following pairs
|
Sl.
No.
|
Name
of the ATM
|
Descriptions
|
|
1
|
White
label ATMs
|
Management
of the ATM & handling of cash dispensation by the Private concern/s for
the Commercial banks
|
|
2
|
Brown
label ATMs
|
ATMs
under joint management of bank & private individual/ concern/s
|
Which
of the above pairs are correctly matched?
a. only 1 b. only 2 c. Both 1 & 2
d. Neither 1 nor 2
99.
What is/are the facility/facilities the beneficiaries can get from the services
of Business
Correspondent (Bank
Saathi) in branchless areas? [CSP 2014]
1. It enable the beneficiaries to
draw their subsidies and social security benefits in their
Villages
2. It enable the beneficiaries in
the rural areas to make deposits and withdrawals
Select the correct
answer using the code given below
a. 1 only b. 2 only c. Both 1 and 2 d. Neither 1 nor 2
100. In the context of
Indian economy, which of the following is/are the purpose/purposes of
‘Statutory Reserve Requirements? [CSP 2014]
1. To enable the Central Bank to control
the amount of advances the banks can create
2. To make the people’s deposits with
banks safe and liquid
3. To prevent the commercial banks from
making excessive profits
4. To force the banks to have sufficient
vault cash to meet their day-to-day requirements
Select the correct answer using the code given
below.
a. 1 only b. 1 and 2 only c. 2 and 3 only d. 1, 2, 3 and 4
*****
