CBSE Class 12 Business Studies Financial Markets MCQs Set 02

Question: __ is a source of financing to meet very short-term fund requirements of commercial banks with a provision of renewal.
(a) Treasury Bill
(b) Commercial Paper
(c) Certificate of Deposit
(d) Call Money

Answer : D

Question: Money market deals in ________
(a) Long term Securities
(b) Medium term securities
(c) Short term Securities
(d) None of the options

Answer : C

Question: ____________ is also called zero coupon bond.
(a) Trade bills
(b) Call money
(c) Treasury bills
(d) Commercial papers

Answer : C

Question: On this day, the exchange will deliver the share or make payment to the other broker,
(a) Pay-in day
(b) Pay-out day
(c) Transaction day
(d) None of the options

Answer : B

Question: What is the meaning of right issue?
(a) Company sells the securities to some selected institutions
(b) Company offers new shares to its existing shareholders
(c) Securities are not issued to existing shareholders at all
(d) None of the options

Answer : B

Question: When is a trade confirmation slip issued to the investor?
(a) On placing an order
(b) On execution of the order
(c) On settlement of the order
(d) None of the options

Answer : B

Question: At present only two depositories are registered with SEBI _____
(a) NSDL and HDFC
(b) NSDL and CDSL
(c) NSDL and ABSL
(d) NEFT and TDS

Answer : B

Question: After the trade has been executed, the broker issues a Contract Note to the investor within
(a) 52 hours
(b) 24 hours
(c) 48 hours
(d) 12 hours

Answer : B

Question:  Which of the following claims about financial markets is correct?
(a) They serve as a link between households that save money and businesses that invest it.
(b) They act as a link between savers and investors by facilitating the transfer of funds.
(c) They invest the money they have available in their most profitable investment option.
(d) All of the options

Answer : D

Question: Under this method of floatation in primary market, a subscription is invited from general public to invest in the securities of a company through the issue of advertisement.
(a) Private placement
(b) Offer through prospectus
(c) Offer for sale
(d) All of the above

Answer : B

Question: __ is the institution which provides a platform for trading of existing securities having long-term maturity.
(a) SEBI
(b) WTO
(c) Stock exchange
(d) RBI

Answer : C

Question: What is meant by Demat Account?
(a) Development Market Account
(b) Depository Participant Account
(c) Dematerialisation of of Securities
(d) Demand Depository Account

Answer : C

Question: Stock exchanges provide an opportunity to the investors to disinvest and invest. Identify the related function of the stock exchange.
(a) Providing scope for speculation.
(b) Providing liquidity and marketability to existing securities.
(c) Pricing of security.
(d) Spreading of equity cult.

Answer : B

Question: It is used as an alternative to bank borrowing for large and creditworthy companies,
(a) Commercial bill
(b) Commercial papers
(c) Call money
(d) None of the options

Answer : B

Question: Clearing and settlement operations of NSE are carried out by:
(a) NSDL
(b) SBI
(c) NSCCL
(d) CDSL

Answer : C

Question: Which of the following statements is not true with regard to primary market?
(a) Is also known as the old issues market.
(b) It facilitates the transfer of investible funds from savers to entrepreneurs.
(c) It deals with new securities being issued for the first time.
(d) It facilitates the transfer of investible funds from savers to entrepreneurs.

Answer : A

Question: In which year the SEBI was established by the Government of India?
(a) 1980
(b) 1988
(c) 1992
(d) 1993

Answer : B

Question: _________ is not a participant in money market
(a) SEBI
(b) NBFCs
(c) RBI
(d) Mutual Funds

Answer : A

Question: Which of the following statements is not true with regard to capital market?
(a) The funds are raised for a short period of time.
(b) Both debt and equity funds can be raised.
(c) It is classified into two types.
(d) All of the options

Answer : A

Question: One of the functions of ‘financial market is providing liquidity to financial assets.
(a) Capital Market
(b) Money Market
(c) Primary Market
(d) Secondary Market

Answer : D

Question: When a trade bill is accepted by a commercial bank, it is known as a _____
(a) Certificate of deposit
(b) Commercial Bill
(c) Call money
(d) None of the options

Answer : B

Question: It is an instrument of short-term borrowing by the Government of India maturing in less than one year.
(a) Commercial bill
(b) Treasury bill
(c) Call money
(d) None of the options

Answer : B

Question: Mr. X bought certain shares of Reliance Ltd. from Mr. Y and lodged them with the depository in form of a book entry. However, as per the register of members of Reliance Ltd., Mr. Y is still the owner of those shares. In such a situation, Mr. X would be known as
(a) Registered owner
(b) Holder of shares
(c) Beneficial owner
(d) None of these

Answer : C

Question: Securities Exchange Board of India (SEBI) was established in __
(a) 1992
(b) 1956
(c) 2001
(d) 1984

Answer : A

Question: It is a short-term, negotiable, self-liquidating instrument which is used to finance the credit sales of firms.
(a) Commercial bill
(b) Commercial papers
(c) Call money
(d) None of the options

Answer : A

Question: Primary and secondary markets:
(a) Control each other
(b) Complement each other
(c) Compete with each other
(d) Function independently

Answer : B

Question: The capital market consists of
(a) Development banks
(b) Commercial banks
(c) Stock exchanges
(d) All of the above

Answer : D

Question: Only institutional investors can participate in __________
(a) Loan Market
(b) Money Market
(c) Foreign Market
(d) Capital Market

Answer : B

Question: Which of the following participants represent capital market?
(a) Development banks
(b) Commercial banks
(c) Stock exchanges
(d) All of the above

Answer : D