Capital Market-4

Select The Blank

Question: The right to buy is called ________.

Correct Answer: Call option



Multiple Choice Single Answer

Question: What percentage of funds should be invested in unlisted companies?

Correct Answer: 0.74



Multiple Choice Single Answer

Question: Who is responsible to get the securities listed on all the stock exchanges?

Correct Answer: Merchant banker



Select The Blank

Question: A mutual fund scheme shall not invest more than ________ of its NAV in unrated debt by a single issuer.

Correct Answer: 0.1



Multiple Choice Single Answer

Question: Since when have the Indian Stock markets risen?

Correct Answer: 37775



Multiple Choice Multiple Answer

Question: Describe in brief the SEBI regulations for venture capital funds:-

Correct Answer: Must disclose investment strategy, VCF's must be registered, Cannot carry out another activity



Multiple Choice Multiple Answer

Question: Describe E-trading:-

Correct Answer: Screen based trading in place of traditional ring, Communication through the net, Operate in stock market privately through home or office



Multiple Choice Multiple Answer

Question: During the budget 2003 - 04, Finance Minister made some announcements which he hopes will make investors think in terms of returning to stock market:-

Correct Answer: No capital gains tax on investment made in equity after 1/3/03 held for 1 year, Removal of income tax on dividends in the hands of receiver



Multiple Choice Multiple Answer

Question: Which companies have eroded market capitalization by Rs 20,000 crores?

Correct Answer: Infosys, Satyam, Wipro



Multiple Choice Multiple Answer

Question: What does SEBI do with its power?

Correct Answer: Cancel certificate issued to custodian, Inspect books of DP, issuers or beneficiary owners, Investigate an acquirer



True/False

Question: Amendment to SCRA will facilitate derivatives trading in interest rate futures and options if there is an underlying asset.

Correct Answer: True



Multiple Choice Multiple Answer

Question: What is dematerialization?

Correct Answer: Physical certificates converted into electronic from, Credited into investors account with his/ her DP



Select The Blank

Question: ________ is in the form of a usance promissory note payable after 45 days from the date of issue.

Correct Answer: Certificate of Deposit



Multiple Choice Single Answer

Question: What is the amount of net worth accompany should have for opting for an IPO?

Correct Answer: 1 Crore



Select The Blank

Question: The process of securitisation involves transfer of assets to a person specially created called as ________.

Correct Answer: Special purpose vehicle



True/False

Question: A mutual fund shall not invest more than 10% of is NAV in equity shares in cases of open ended schemes.

Correct Answer: True



Multiple Choice Single Answer

Question: What is a put option?

Correct Answer: Right to sell



True/False

Question: Venture capital finance is risk finance for entrepreneurial growth oriented companies.

Correct Answer: True



Multiple Choice Single Answer

Question: Who can change the composition of securities?

Correct Answer: Fund manager



True/False

Question: Employee stock option scheme granted to the employee is transferable.

Correct Answer: False



True/False

Question: Transactions that involve substantial payment towards goodwill, brand equity or intellectual property must be placed before the board of directors as per the recommendations of the Kumarmangalam Birla report.

Correct Answer: True



Multiple Choice Single Answer

Question: Deposits can be accepted for a maximum period of:-

Correct Answer: 5 years



Multiple Choice Single Answer

Question: In the wake of boom of which sector the Indian mutual fund launched various sector specific schemes?

Correct Answer: Software



Select The Blank

Question: In 2001 a case of rigging and short selling based insider trading was noticed in the case of proposed merger of ________.

Correct Answer: UTI Bank with GTB



Select The Blank

Question: ________ are a kind of portfolio schemes.

Correct Answer: Mutual funds



Multiple Choice Single Answer

Question: What is equipment leasing?

Correct Answer: Contractual agreement where the lessor of equipment transfers the right to use the equipment to the lessee



True/False

Question: Mergers and amalgamations of companies are also covered under the SEBI regulations 1997.

Correct Answer: False



Select The Blank

Question: `

Correct Answer: 0.1



Multiple Choice Single Answer

Question: If the unlisted company does not satisfy the criteria of net worth profitability and issue size how can it come out with a public issue?

Correct Answer: Through book building process



Multiple Choice Single Answer

Question: Which is the favorite destination for venture funds?

Correct Answer: BPO



Multiple Choice Multiple Answer

Question: Who issues participatory notes?

Correct Answer: Associates of India based foreign brokerages, Domestic institutional brokerages



Multiple Choice Single Answer

Question: For a VCF to be registered with SEBI what is the registration fee?

Correct Answer: 5 lacs



Match The Following



Question
Correct Answer
Your Answer

Ready forward transaction (Repo)
Interbank sale and repurchase of securities
Interbank sale and repurchase of securities

Commercial paper
Means of raising short term debt by companies
Means of raising short term debt by companies

STCI
Operations in call money markets
Operations in call money markets

Market stabilsation Bonds
Launched in fiscal 2004-05
Launched in fiscal 2004-05




True/False

Question: Constant change would be one of the reasons for failure of corporate governance.

Correct Answer: True



True/False

Question: The company opting for an IPO should have net worth of at least Rs 1 crore in each of the preceding two years.

Correct Answer: True



True/False

Question: The acquirer is 3required to appoint a merchant banker before making a PA.

Correct Answer: True



Multiple Choice Multiple Answer

Question: The features of mutual Fund are:-

Correct Answer: A trust that pools in savings and funds from large number of investors who have common financial goal, Issue units to investor which represent right in assets, Investments in mutual funds may be in the form of stock, bond, money market securities



Multiple Choice Single Answer

Question: The process of 2share buy back must be completed within what period from the date of passing the resolution?

Correct Answer: 12 months



Select The Blank

Question: A ________ means any persons 2connected with a company and who is reasonably having access to unpublished price sensitive information.

Correct Answer: Insider



Select The Blank

Question: The NSE Nifty index comprises of ________companies.

Correct Answer: 50



True/False

Question: ISIN is a unique identification number for security.

Correct Answer: True



Multiple Choice Multiple Answer

Question: Companies are not allowed to buy back securities:-

Correct Answer: Through any/ own subsidiary company, Through any/group of investment company, If default subsists in respect of repayments of deposits, term loans to any financial institutions and redemption of preference shares or debentures



Multiple Choice Multiple Answer

Question: Briefly describe the SEBI guidelines for the merchant bankers:-

Correct Answer: Should have an authorization from SEBI, Expertise good financial standing and high degree of professional integrity, Company abides by the various requirements relating to disclosers, listing of instruments etc



Multiple Choice Single Answer

Question: What is issued by mutual funds?

Correct Answer: Units



Select The Blank

Question: The merchant bankers should act as ________ of the investor's money and put a lot of responsibility on them.

Correct Answer: Custodian



Select The Blank

Question: BSE introduced an equity stock index known as ________.

Correct Answer: SENSEX



Multiple Choice Single Answer

Question: What is the time frame to submit a report to SEBI for acquisition transactions arising out of firm allotment in public issues right issues etc?

Correct Answer: 21 days



Multiple Choice Single Answer

Question: What is government's move towards Stock Exchanges?

Correct Answer: Demutulisation



Multiple Choice Multiple Answer

Question: As per the recommendations of the Kumarmangalam Birla committee report who are the key components of an audit committee.

Correct Answer: External auditor, Board, Internal auditor



Multiple Choice Single Answer

Question: What is the objective of a credit information company?

Correct Answer: To ascertain the credit worthiness of individuals/organizations and make the data available to all banks



Multiple Choice Single Answer

Question: When are VCF's entitled to get its units listed on stock exchange?

Correct Answer: After expiration of 3 years form date of issuance of units



Multiple Choice Single Answer

Question: A portfolio manager could undertake the following on behalf of his clients:-

Correct Answer: Hedging and arbitrage transactions



Select The Blank

Question: Final prospectus in the book building p________ess is to be filed with the ROC.

Correct Answer: ROC



Multiple Choice Single Answer

Question: How many companies are there to do business of credit rating?

Correct Answer: 4



Multiple Choice Multiple Answer

Question: What are the general obligations of mutual fund?

Correct Answer: Every AMC should maintain proper books of accounts, Financial year for all schemes to end as on March 31 each year, Every mutual fund shall have the annual statements audited by auditor



Select The Blank

Question: Recently, SEBI has allowed buy back of shares upto ________% of the total shares without requirement of a special resolution

Correct Answer: 10



Multiple Choice Multiple Answer

Question: What are the salient features of Hire Purchase?

Correct Answer: Finance company purchases the equipment supplier and lets it on hire, During the contract hirer can opt for an early repayment and purchase the asset, Hirer may be required to make down payment



Multiple Choice Single Answer

Question: Who takes risk at the time of investment?

Correct Answer: Investor



Select The Blank

Question: A company with highly rated instrument has the opportunity to ________ by quoting less interest rates.

Correct Answer: Reduce the cost of borrowing



Multiple Choice Multiple Answer

Question: How is price determined in an open offer?

Correct Answer: Negotiated price, Price paid by acquirer, Average weekly high low of closing share of the target company



Multiple Choice Single Answer

Question: Renewal of portfolio fund on maturity shall be deemed as a fresh placement for a minimum period of:-

Correct Answer: 1 year



True/False

Question: A custodian can transfer beneficial ownership legally.

Correct Answer: False



Multiple Choice Single Answer

Question: Apart from the portfolio management fees what percentage of returns can the portfolio manager share from their client's profits?

Correct Answer: 0



Multiple Choice Multiple Answer

Question: What are the different kinds of stock exchanges in India?

Correct Answer: Voluntary non profit making organizations, Joint stock companies limited by shares, Joint stock companies Limited by guarantee



Select The Blank

Question: For issues upto Rs. 50 crores the number of lead managers will not exceed ________.

Correct Answer: 2



Multiple Choice Single Answer

Question: Upto what percentage has the RBI permitted the banks to invest in the capital market?

Correct Answer: 0.05



Select The Blank

Question: Among the closed schemes, 4 long term assurance schemes were launched with a return ranging between ________.

Correct Answer: 13 - 14%



Multiple Choice Single Answer

Question: What was the percentage of public offering under the IPOs through the book building method?

Correct Answer: 0.1



Multiple Choice Multiple Answer

Question: What are the main features of commercial paper?

Correct Answer: Short term financial instrument, Negotiable and transferable instrument, Companies issue it for raising short term debt



Select The Blank

Question: A ________ can legally transfer beneficial ownership.

Correct Answer: Depository



Multiple Choice Multiple Answer

Question: The setting up of NSE consists of:-

Correct Answer: Set up by IDBI, Equity paid up capital of Rs25 crores, Started operations in June 1994



True/False

Question: institutional investors and underwriters.

Correct Answer: True



Multiple Choice Multiple Answer

Question: To open a DP account, following things are required:-

Correct Answer: Proof of identity, Proof of address, Photograph