Deck 5: Securities, Financing, and Investments: Exploring the World of Finance

Question 1

In --------------- Securities share bond debentures are offered to the public for subscription for raising capital or fund.

A)Prime Securities
B)Public Securities
C)Preferred Securities
D)Primary Securities

Answer 1

Prime Securities

Question 2

ADR Stands for:

A)Asset Depository Receipt
B)Asian Depository Receipt
C)American Depository Receipt
D)Adjustable Depository Receipt

Answer 2

American Depository Receipt

Question 3

SEBI operates to fulfill the needs of these three groups, choose the one which is not in those three:

A)the issuers of securities
B)the police
C)the investors
D)the market intermediaries

Answer 3

the police

Question 4

The largest industry group receiving venture capital funding is

A)computer software.
B)medical/health.
C)computer hardware.
D)none of the above.

Question 5

Most automobile financing is provided by

A)commercial banks.
B)thrifts.
C)finance companies owned by automobile companies.
D)finance companies owned by real estate brokers.

Question 6

Business finance companies provide specialized forms of credit to businesses by making loans and purchasing accounts receivable at a discount; this provision of credit is called

A)discounting.
B)factoring.
C)refinancing
D)sparking.

Question 7

Which one of the following is a regarded as classic venture capital?

A)MBO finance
B)Early stage
C)Institutional
D)Corporate

Question 8

Which agency regulates and supervises NBFCs?

A)Finance Ministry
B)SEBI
C)RBI
D)Respective state government

Question 9

Which of the following statements is/are correct?
1) NBFCs does not hold a banking license.
2) NBFC can issue Demand Drafts like banks.

A)Only 1
B)Only 2
C)Both
D)None

Question 10

Consider the following statements
1) Chit Funds are type of NBFC
2) All NBFCs are ruled by RBI
3) RBI said any purchase of a stake of 26% or more in a company, or a change in more than 30% of its directors, would need the central bank's permission.
Which of the above statements is/are correct?

A)1,2
B)2,3
C)1,3
D)All

Question 11

Markets in which derivatives are traded are classified as

A)assets backed market
B)cash flow backed markets
C)mortgage backed markets
D)derivative securities markets

Question 12

Consider buying of put option, probability that a buyer would have negative payoff increases with the

A)increase in stock price
B)decrease in stock price
C)increase in maturity duration
D)decrease in maturity duration

Question 13

Price of an option is subtracted form time value of option to calculate

A)book value index
B)market index
C)intrinsic value
D)extrinsic value

Question 14

If intrinsic value of an option is $450 and price of an option is $560 then time value of an option is

A)$110
B)$1,010
C)$450.00
D)$560

Question 15

Type of swaps in which fixed payments of interest are exchanged by two counterparties for floating payments of interest are called

A)float-fixed swaps
B)interest rate swaps
C)indexed swaps
D)counter party swaps

Question 16

Type of bonds that pay coupon interest are classified as

A)forward bond
B)payment bonds
C)coupon bond
D)interest bonds

Question 17

For given change in interest rates, percentage change in present value of bond is classified as

A)price sensitivity
B)yield sensitivity
C)maturity sensitivity
D)premium sensitivity

Question 18

Type of bond whose present value is lesser than that of its face value is classified as

A)discount bond
B)premium bond
C)coupon bond
D)interest bonds

Question 19

For an investment, weighted average time to maturity is considered as

A)premium time
B)standard time
C)mean time
D)duration

Question 20

Bonds that does not pay any interest rate are considered as

A)interest free bond
B)zero coupon bond
C)price less coupon bond
D)useless price bonds