MCQ on Principle of Finance and Banking 3

COEP
Lets Crack Online Exam

Objective Questions and Answers of MBA: MCQ on Principle of Finance and Banking 3

Subject: Objective Questions and Answers of MBA: MCQ on Principle of Finance and Banking 3

Part 3: List for questions and answers of Principles of Insurance and Banking

 

Q1. What is a Lease?

a) A rental agreement between owner of a flat/house and the Tenant, whereby the Tenant pays specified amount on specified dates to the owner

b) A legal contract between the owner of an asset and its user, containing many conditions including payment of a specified amount by the user to the Owner for use of the asset

c) Both (a) and (b)

d) None of the above

 

Q2. What is Factoring?

a) An easy way of raising capital from a factoring company by small business

b) Selling of account receivables on a contract basis for cash payment to a factor before it is due

c) An arrangement for raising short term money against prepaid expenses

d) A method of discounting of long term bills

 

Q3. Which one of the following is called as initial repayment holiday given to a borrower for repayment of loan?

a) Amortization

b) Moratorium

c) Subvention

d) None of the above

 

Q4. Who sets up ‘Base Rate’ for Banks?

a) Individual Banks Board

b) Interest Rate Commission of India

c) RBI

d) None of the above

 

Q5. Which of the following are Bank advances of a Bank?

a) Bad debts

b) Non-performing Assets

c) Out of order accounts

d) Overdrawn accounts 

 

Q6. Which of the following are benefited through the Reserve mortgage scheme?

a) Government employees

b) Minors

c) Senior citizens

d) All the above

 

Q7. Which of the following are the amounts owed to a company that are not going to be paid?

a) Bad debts

b) Non-performing Assets

c) Out of order accounts

d) Overdrawn accounts

 

Q8. Whom with Primary Dealers deal in both primary and secondary markets?

a) Corporate Bonds

b) Debentures

c) Equities

d) Government Securities

 

Q9. What will be the impact if Reserve Bank of India reduces the Bank Rate by 1%?

a) Less liquidity in the market

b) More liquidity in the market

c) No change in the market liquidity

d) Mobilisation of more deposits by commercial banks

 

Q10. What is the full form of IRR?

a) Internal Rate of Return

b) Internal Reserve Ratio

c) Internal Rate of Ratio

d) Internal Recession Rate

 

Q11. Which among the following made the initial contribution for setting up Financial Inclusion Fund and Financial Inclusion Technology Fund?

a) Government of India, NABARD and RBI

b) NABARD, UTI and RBI

c) SIDBI, Government of India and IDBI Bank

d) SIDBI, NABARD and UTI 

 

Q12. Which one of the following is known as the real return to the investor getting reduced due to sudden rise in the prices of the commodities?

a) Cost risk

b) Demand risk

c) Market risk

d) Systemic risk

 

Q13. When did insurance begin in Babylon?

a) 1750 BC

b) 1907 BC

c) 1971 BC

d) 2000 BC

 

Q14. Which of the following is the correct definition of Hot Money?

a) This is the fund which is dumped into a country to get the advantage of a favourable interest rate

b) This is the fund which is provided by a bank in US $ at very short notice and at a very high rate of interest and for a longer period of repayment

c) This is the fund which is pushed into market through illegal methods

d) None of the above

 

Q15. What will bank customers pay for using safe deposit locker facilities?

a) Commission on locker

b) Exchange on locker

c) Rent on locker

d) Safe custody charges

 

Q16. Which one of the following is known as a Savings Bank Account opened with a commercial bank with zero balance or very minimal balance?

a) Current Account

b) No frill account

c) Savings Bank-ordinary Account

d) Students Savings Bank Account

 

Q17. What does the letter ‘R’ denote in the abbreviation ‘BR Act’ which controls banking activities in the country?

a) Reclamation

b) Reformation

c) Regulation

d) Rule 

 

Q18. What is Mortgage?

a) A security created on immovable property for a deposit received by a bank

b) A security created on immovable property for a loan given by a bank

c) A facility created on movable property for a deposit received by a bank

d) A security created on movable property for a loan given by a bank

 

Q19. Which is the minimum lending rate decided by RBI which shall be adopted by all Public Sector Banks?

a) Bank rate

b) Base rate

c) Overnight rate

d) None of the above

 

Q20. Which one of the following depicts the financial position of a bank or business enterprise at a given point of time?

a) Balance sheet

b) Cash flow statement

c) Income statement

d) Model audit

 

Part 3: List for questions and answers of Principles of Insurance and Banking

 

Q1. Answer: b

Q2. Answer: b

Q3. Answer: b

Q4. Answer: c

Q5. Answer: b

Q6. Answer: c

Q7. Answer: a

Q8. Answer: d

Q9. Answer: b

Q10. Answer: a

Q11. Answer: a

Q12. Answer: c

Q13. Answer: a

Q14. Answer: a

Q15. Answer: c

Q16. Answer: b

Q17. Answer: c

Q18. Answer: b

Q19. Answer: b

Q20. Answer: a

c) Core Banking System

d) Core Banking Service

 

Q2. Subprime lending’ is a term applied to the loans made to

a) Those borrowers who do not have a good credit history

b) Those borrowers who have a good credit history

c) Those borrowers who do not have a good debit history

d) Those borrowers who have a good debit history

 

Q3. Which among the following is the act of taking on a risk for a fee?

a) Guidewire

b) Initial Public Offering

c) Predictive analytics

d) Underwriting

 

Q4. Which among the following is called the rate of interest charged by RBI for lending money to various commercial banks by rediscounting of the bills in India?

a) Bank Rate

b) Discount Window

c) Monetary Policy

d) Overnight Rate

 

Q5. Which of the following are to be followed by Commercial Banks for risk management?

a) Basel II norms

b) Basel III norms

c) Basel I norms

d) Solvency II norms

 

Q6. What is the full form of CRR?

a) Cash Reserve Rate

b) Cash Reserve Ratio

c) Cash Recession Ratio

d) Core Reserve Rate 

 

Q7. What is the full form of ‘MAT’?

a) Maximum Alternate Tax

b) Minimum Alternate Tax

c) Maximum Alternate Time

d) Minimum Alternate Time

 

Q8. What is the full form of NDTL?

a) New Demand and Tenure Liabilities

b) Net Demand and Time Liabilities

c) National Deposits and Total Liquidity

d) Net Demand and Tax Liabilities

 

Q9. Which one of the following is known as the recession occurring two times with a small gap in between?

a) Deep Recession

b) Deflation

c) Double-dip Recession

d) Double Inflation

 

Q10. Basel Committee on Banking Supervision” is also known as

a) Bank for International Settlements Committee

b) Banking Regulation Committee

c) Financial Stability Board

d) Global Financial System

 

Q11. What is the full form of NAV?

a) Net Actual Value

b) Net Annual Value

c) Net Asset Value

d) Net Average Value

 

Q12. Who issues ‘Commercial Papers’?

a) A Company to a Bank

b) Banks to Banks

c) Banks to Companies

d) Company to its suppliers 

 

Q13. What is the full form of SWIFT?

a) Safe Window for Interbank Financial Transactions

b) Safe Window In case of Financial Transaction

c) Society for Worldwide Interbank Financial Telecommunication

d) Safe Window Institute For Transactions

 

Q14. Which of the following is known as the concept of a standard contract to buy or sell a specified commodity at a certain date in future and at a market driven price?

a) Forward Contract

b) Futures Contract

c) Market Contract

d) Standard Contract

 

Q15. Which one of the following set up core banking infrastructure for rural banks?

a) IBA

b) NABARD

c) RBI

d) SIDBI

 

Q16. Which organization provides credit history of the borrowers?

a) CIBIL

b) CII

c) FRBI

d) IRDA

 

Q17. Which one of the following organisations has been set up to facilitate connectivity between the Bank’s switches and their ATMs, and inter bank payment gateway for authentication and routing the payment details of various e-commerce transactions?

a) IBA

b) IDRBT

c) IRDA

d) SIDBI

 

Q18. Which is a tool that helps RBI to stabilize money supply and prices of Government securities?

a) EOQ

b) EPQ

c) JIT

d) OMO 

 

Q19. Who regulates the Mutual Funds in India?

a) FRBI

b) SEBI

c) SIDBI

d) RBI

 

Q20. What is ‘fiat money’?

a) The currency is backed by Government Guarantee

b) The currency is backed by tangible assets

c) The currency is backed by gold reserves

d) The currency is backed by budgetary support

 

Part 2: List for questions and answers of Principles of Insurance and Banking

 

Q1. Answer: a

Q2. Answer: a

Q3. Answer: d

Q4. Answer: a

Q5. Answer: a

Q6. Answer: b

Q7. Answer: b

Q8. Answer: b

Q9. Answer: c

Q10. Answer: a

Q11. Answer: c

Q12. Answer: b

Q13. Answer: c

Q14. Answer: b

Q15. Answer: b

Q16. Answer: a

Q17. Answer: b

Q18. Answer: d

Q19. Answer: b

Q20. Answer: a