1. Which of the following terms is used in Banking Field?

A. Interest Rate Swap B. Input Devices C. Sedimentary D. Zero Hour E. Privilege Motion

2. On which one of the following issues can SEBI penalize any company in India?

A. Violation of Banking Regulation Act. B. Violation of foreign portfolio investment guidelines. C. For violation of Negotiable Instrument Act. D. Only (A) (b) E. Only (B)

3. Expand the term ALM as used in Banking/Finance sector?

A. Asset Liability Mismatch B. Asset Liability Maturity C. Asset Liability Management D. Asset Liability Manpower E. None of the above

4. What is the full form of the term LIBOR as used in financial banking sectors?

A. Local Indian Bank Offered Rate B. London-India Bureau of Regulations C. Liberal International Bank Official Ratio D. London inter Bank Offered Rate E. None of the above

5. Expand the term FSDC which is used in financial sectors?

A. Financial Security and Development Council B. Financial Stability and Development Council C. Fiscal Security and Development Council D. Fiscal Stability and Development Council E. None of the above

6. For which one of the following reasons are Basel II norms to be followed by Commercial Banks?

A. Risk management B. Adoption of international accounting standards C. Restriction on bonus payments to bank executives D. Transparency in disclosures E. None of the above

7 Which one of the following will set up core banking infrastructure for rural banks?

A. RBI B. NABARD C. SIDBI D. IBA E. None of these

8. Which of the following rates/ratios is not covered under the RBI monetary and credit policy

A. Bank rate B. Exchange rate of foreign currencies C. Repo rate D. Reverse repo rate E. Cash reserve ratio

9. When a loan is granted by a bank for purchase of white goods it is called

A. Consumption loan B. White goods loan C. Consumer durable loan D. All of these E. None of these

10. As per the reports in various newspapers many private companies are trying to obtain the licences to launch a banking company in India. Which of the following organizations/agencies issue the licence for the same?

A. Securities and Exchange Board of India (SEBI) B. Indian Institute of Banking and Finance (IIBF) C. Indian Banks Association D. Registrar of Companies E. None of the above

Answers
1. Answer - Option A
2. Answer - Option D
3. Answer - Option C
4. Answer - Option D
5. Answer - Option B
6. Answer - Option A
7. Answer - Option B
8. Answer - Option B
9. Answer - Option C
10. Answer - Option C

1. Which of the following methods is being adopted by Banks for calculating and applying interest on Savings Bank accounts?

A. On monthly products based on minimum balance between [latex]{10}^{th}[/latex] and last working day. B. Daily balance is counted and interest is paid accordingly C. On average quarterly balance. D. On average half yearly balance E. None of the above

2. The main function of IMF is to

A. give financial investment loans to devoloping countries B. act as a private sector lending arm of the World Bank C. help of solve balance of payment problems of member countries D. arrange international deposits from banks E. None of the above

3. Which of the following is not a part of the scheduled banking structure in India ?

A. Money lenders B. Public sector banks C. Private sector banks D. Regional rural banks E. State cooperative banks

4. The rate of interest on savings bank account is stipulated by

A. the concerned bank B. RBI C. Indian banks association D. Government of India E. Banking codes and standards board of India

5. Many times we read a term 'CBS' used in banking operation. What is the full form of the letter 'C' in the term 'CBS'?

A. Core B. Credit C. Continuous D. Complete E. None of these

6. The RBI reviews its credit and monetary policy at regular intervals and also in between. What is the purpose of the same ? A. To ensure that inflation does not cross limits. B. To ensure that banks have enough liquidity. C. To ensure that cost of the fund does not reach a very high level

A. Only A B. Only B C. All A, B and C D. Only B and C E. None of these

7 Under provisions of which one of the following Acts does the RBI issue directives to the Banks in India ?

A. RBI Act B. Banking Regulation Act C. Essential Commodities Act D. RBI and Banking Regulation Act E. None of the above

8. Which one of the following tools is used by RBI for selective credit control ?

A. It advises banks to lend against certain commodities B. It advises banks to recall the loans for advances against certain commodities C. It advises banks to charge higher rate of interest for advance against certain commodities. D. It discourages certain kinds of lending by assigning higher risk weights to loans it deems undesirable. E. None of the above

9. For which one of the following are loan products 'teaser loans' offered by banks?

A. Education loans B. Commercial laons C. Loans against security of gold D. Retail trade loans E. Home loans

10. Under provisions of which one of the following Acts has the Reserve Bank of India has the power to regulate, supervise and control the banking sector?

A. RBI Act B. Banking Regulation Act C. Negotiable Instruments Act D. RBI and Banking Regulation Act E. None of the above

Answers
1. Answer - Option B
2. Answer - Option C
3. Answer - Option A
4. Answer - Option D
5. Answer - Option A
6. Answer - Option C
7. Answer - Option D
8. Answer - Option B
9. Answer - Option E
10. Answer - Option B

1. Credit rating is

A. used to rate the borrowers while giving advances B. used to work out performance of the employees C. used to calculate the number of excellent audit rated branches D. not used in any bank E. necessary before giving promotion to employees

2. RTGS stands for

A. Real Time Gross Settlements B. Reduced Time Gross Settlements C. Relative Time Gross Settlements D. Real Total Gross Securities E. None of the above

3. As we all know, the Bank Rate at present is fixed at 6%. What does it mean in context to the banking operations ?

A. No bank will be able to give loan to any patron at a rate lower than the Bank Rate. B. Bank should give loan to their priority sector customers/ borrowers at the rate of 6% only. They cannot charge less or more than this from their priority sector clients. C. Banks are required to invest 6% of their total capital on financial inclusion and inclusive banking operations. D. Banks will be required to give 6% of their total deposits to the Govt. of India for meeting its Balance of Trade requirements. E. None of the above

4. As we all know, the RBI has raised the Cash Reserve Ratio (CRR) by 25 bps, in April 2010. What action will banks have to take to implement the same ? (A) They will have to deposit some more money with the RBI as reserve money. (B) Banks will be required to give some more loan to projects of the priority sector. (C) Banks will be required to give a loan equivalent to the CRR to the Govt. of India for its day to day expenditure as and when required.

A. Only A B. Only B C. Only C D. Only A and B E. All A, B and C

5. Insurance service provided by various banks is commonly known as ______

A. Investment Banking B. Portfolio Management C. Merchant Banking D. Bancassurance E. Micro Finance

6. The rate on which banks borrow from the RBI is called ____

A. SLR B. CRR C. Interest Rate D. Bank Rate E. Repo Rate

7. As we know, the RBI is the apex bank of India; similarly, the apex Bank of USA is called ___

A. Federal Reserve B. The Central Bank of USA C. Bank of America D. Central Bank of USA E. None of the above

8. What is the full form of 'NBFC' as used in the Financial Sector?

A. New Banking Finance Company B. National Banking & Finance Corporation C. New Business Finance & Credit D. Non Business Fund Company E. None of the above

9. Cross-selling is not effective for which one of the following products ?

A. Debit cards B. Savings accounts C. Internet banking D. Pension loans E. Personal loans

10. As per the news published in a financial publication, RBI is redesigning its 'ECS' to function as an Automated Clearing House (ACH) for bulk transactions. What is full form of 'ECS'?

A. Extra Closing System B. Electronic Cheque System C. Evening Cheque Sorter D. Evening Cheque System E. Electronic Clearing Service

Answers
1. Answer - Option A
2. Answer - Option A
3. Answer - Option A
4. Answer - Option A
5. Answer - Option D
6. Answer - Option D
7. Answer - Option A
8. Answer - Option E
9. Answer - Option D
10. Answer - Option D

1. What is “wholesale banking”?

A. It is a bank-to-bank or B2B dealing B. It is a bank-to-customer dealing C. It is a bank-to-trustworthy customer dealing D. It is a bank-to-government dealing E. None of these

2. Which of the following is the full form of the term SLR as used in the banking sector?

A. Social Lending Ratio B. Statutory Liquidity Ratio C. Scheduled Liquidity Rate D. Separate Lending Rate E. None of these

3. What is hot money?

A. Money which has tendency to migrate towards highprofit-oriented places. B. Money which has tendency to migrate towards lowprofit-oriented places C. Money, which has no interest D. Only (a) and (b) E. Only (a) and (c)

4. As we all know, the major source of income of the banks is lending money (providing credit) and earning interest on it. In normal circumstances, the demand of credit comes mainly from which of the following sectors ? 1. Personal Loans 2. Priority Sector Lending and Bailout Packages 3. Project Finance

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 and 3 E. None of these

5. One of the sources of income of banks is to charge fee for certain services. What are some of the services provided by the banks for which they charge fee? 1. Issuing Demand Drafts/Pay Orders 2. Issue of ATM/Credit/Debit Cards 3. Electronic Transfer of Money

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 and 3 E. None of these

6. Many banks have launched/ floated their subsidiaries which are fully owned by them. Banks launch subsidiaries normally for which of the following businesses? 1. Home Loan Business 2. To sell Insurance Policies 3. To control Online Operations or Internet Banking business

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 and 3 E. None of these

7. "The set of directive principles issued by the Central Bank of a country or the process adopted by it to control the supply of money, availability of money, cost of money and rate of interest, etc. in order to bring stability and growth of the economy" are commonly known as-

A. Monetary policy of the Central Bank of the country B. Budget of the Govt C. Profit and Loss Account D. Business Policy of the Bank E. None of these

8. As we see every day, many Indian banks are in close competition to open their branches / offices in various countries. What benefit will the Indian economy have if banks open branches in a foreign country ? 1. It will bring substantial economic benefits to India and also to the countries where branches will be opened. 2. It will help in smooth inflow of FDI, long term capital inflow and also technical know-how to India. 3. It will give better opportunities to Indians to visit foreign nations and get better facilities like education, medical treatment, etc.

A. Only 1 B. Only 2 C. Only 3 D. Only 1 and 2 E. All 1, 2 and 3

9. "Higher provisioning dragged down the profits of down the 4th quarter of some banks" was the news in some major newspapers. This means that the banks

A. had many NPAs B. had no NPA C. was in great loss D. was not able to earn any profit last year E. None of these

10. As we all know, RBI hiked the CRR by 0·25 basis points. What immediate impact will it have on the functioning of banks ? 1. Banks will have to lock some additional fund with the RBI without any income generation to the banks on these funds. 2. Banks will have to raise their capital base by bringing IPOs or by taking money from the Govt. of India. 3. Banks will have to give more funds to priority sectors and less to corporate sector.

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 and 3 E. None of these

Answers
1. Answer - Option A
2. Answer - Option B
3. Answer - Option A
4. Answer - Option D
5. Answer - Option D
6. Answer - Option D
7. Answer - Option A
8. Answer - Option D
9. Answer - Option A
10. Answer - Option A

1. When the Reserve Bank says that the Rupee is over-valued, it means?

A. RBI has shortage of hard currency and it has to order for printing of new notes to the press concerned B. Rupee is appreciating against other currencies whereas other currencies are weakening against US Dollar C. Money is locked in banks and people do not have enough to make their day to day purchases. It is a strategy which brings down inflation D. More and more people are selling their stocks. As a result stock market may crash, as there is no hard cash for such voluminous transactions E. None of these

2. Which of the following is not a nationalised bank?

A. Canara Bank B. Allahabad Bank C. IDBI Bank D. PNB E. None of the above

3. Which of the following is not a financial regulator?

A. IRDA B. PFRDA C. AMFI D. SEBI E. None of the above

4. Which of the following key rates has not been altered by RBI since 2003?

A. Bank Rate B. Statutory Liquidity Ratio C. Cash Reserve Ratio D. Repo Rate E. None of the above

5. Mobile banking is set to get a boost from IMPS, which stands for

A. Inter-Bank Mobile Payment Service B. Inter-Bank Money Payment Service C. Inter-Bank Money Payment D. Inter-Bank Money Payment System E. None of the above

6. Which of the following is not correctly matched?

A. Mutual Fund & SEBI B. ULIP & SEBI C. Pension & PFRDA D. Insurance & IRDA E. None of the above

7. Which among the following are the oldest financial institutions in India?

A. Private Agencies B. Commercial Banks C. Reserve Bank of India D. State bank of India E. None of the above

8. In which year was SIDBI established?

A. 1975 B. 1998 C. 1990 D. 1978 E. 1981

9. Which among the following is the first Development Financial Institution in the country to cater to the long-term finance needs of the industrial sector?

A. IFCI B. IDBI C. ICICI D. SIDBI E. SBI

10. Which among the following is the main function of Agricultural Finance Corporation Limited ?

A. consultancy services in the field of agriculture B. social service organization C. Agricultural commodities exchange D. Agricultural cooperative society E. none of the above

Answers
1. Answer - Option B
2. Answer - Option C
3. Answer - Option C
4. Answer - Option A
5. Answer - Option A
6. Answer - Option B
7. Answer - Option B
8. Answer - Option C
9. Answer - Option A
10. Answer - Option A

1. National Rural Credit Stabilization Fund is a Institution of purpose-specific funds in which of the following?

A. IDBI B. SIDBI C. NABARD D. IFCI E. AFCL

2. To meet the need of which of the following has the concept of Land Development Bank been developed?

A. Industries B. Real estate C. Farmers D. Export Oriented Units and SEZ E. Education Institutes

3. Which among the following statement is incorrect regarding Land Development Banks?

A. They are cooperative institutions B. They meet the needs of the farmers for development purposes C. They have two tier structures: at state and district level D. They grant loans on mortgage security E. They are customers of NABARD

4. Which among the following statements is incorrect regarding the Regional Rural Banks?

A. They have been established as per the provisions of Regional Rural Banks Act 1976 B. Every Regional Rural Bank is sponsored by commercial banks C. The commercial banks need to approach to the state governments to establish Regional Rural Banks D. The Regional Rural Banks may open branches in notified area E. All statements are correct

5. Which among the following is the correct statement?

A. Cooperative Banks are fully controlled by RBI B. Cooperative Banks are partially controlled by RBI C. Cooperative Banks are not controlled by RBI D. Cooperative Banks are fully controlled by Banking Regulation Act 1949 E. None of the above is correct

6. Agency Functions of the commercial Banks are __?

A. Primary Functions B. Secondary Functions C. Tertiary Functions D. Social Functions E. None of the above

7. Which among the following is an essential feature of a commercial bank?

A. providing Locker facilities B. dealing with credit C. providing business information and data D. Underwriting E. Sale of securities

8. Which among the following Banks in India was the first to take a major step of reorganizing based upon market segmentation?

A. ICICI Bank B. State Bank of India C. Punjab National Bank D. Bank of Baroda E. Indian Bank

9. When a person has a savings account in the bank , the bank assumes the position of ___?

A. Debtor B. Creditor C. Agency D. Depositor E. Agent

10. Which among the following is the Bank rate?

A. the rate at which a commercial Bank lends to its customers B. the rate at which a commercial Bank lends to its best customers C. the rate at which a central Bank lends to commercial Banks D. the rate at which a Commercial Bank lends to Central bank E. the rate at which a commercial Bank accepts deposits from its customers

Answers
1. Answer - Option C
2. Answer - Option C
3. Answer - Option C
4. Answer - Option C
5. Answer - Option B
6. Answer - Option D
7. Answer - Option B
8. Answer - Option B
9. Answer - Option A
10. Answer - Option C

1. An investor or speculator who subscribes to a new issue with the intention of selling them shares soon after allotment to realize a quick profit is called?

A. Bull B. Bear C. Stag D. Short E. Tall

2. The Unclaimed deposits are those deposits which haven't been operated for ______?

A. 5 years or more B. 7 years or more C. 10 years or more D. 12 years or more E. 15 years or more

3. In which year Statutory Liquidity Ratio was first imposed on banks?

A. 1949 B. 1951 C. 1955 D. 1968 E. 1971

4. On which of the following dates does a Bank publish its balance sheet ?

A. March 31 B. April 1 C. December 31 D. January 1 E. None of the above

5. Which among the following was the first Commercial Bank of India?

A. Hindustan Bank B. The bank of Bengal C. Imperial Bank of India D. Punjab National Bank E. Allahabad Bank

6. A new private bank is established under which of the following?

A. Banking regulation Act 1949 B. Companies Act 1956 C. RBI Act 1934 D. All of the above E. None of the above

7. In which stock exchange, ‘currency futures’ trading was first started ?

A. BSE B. NSE C. MCX-SX D. All the above had the trading simultaneously

8. ‘ECB’ stands for

A. Extra Cornmercial Banking B. Extra Commerical Borrowing C. External Commerical Borrowing D. Extra Community for Bank E. None of these

9. What is a “Consortium”?

A. When more than one bank allow credit facility to one party in coordination with another under a formal arrangement . B. In a consortium more than two persons together take loan from one bank. C. In a consortium, banks provide loan only to the poor. D. Both (a) and (b) are correct E. None of these

10. The Stock market index of London Stock Market is referred as—

A. Sensex B. Footsie (FTSE) C. NIFTY D. Bullish E. None of these

Answers
1. Answer - Option C
2. Answer - Option C
3. Answer - Option A
4. Answer - Option A
5. Answer - Option A
6. Answer - Option B
7. Answer - Option B
8. Answer - Option C
9. Answer - Option A
10. Answer - Option B

1. As we all know Ministry of Finance every year prepares Union Budget and presents it to the Parliament . Which of the following is / are the elements of the Union Budget? (1) Estimates of revenue and capital receipts. (2) Ways and Means to raise the revenue. (3) Estimates of expenditure.

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 & 3 E. None of these

2. The Reserve Bank of India keeps on changing various ratio/ rates frequently. Why is this done? (1) To keep inflation under control. (2) To ensure that Indian Rupee does not lose its market value. (3) To ensure that Banks do not earn huge profits at the cost of public money.

A. Only 1 B. Only 2 C. Only 3 D. All 1, 2 & 3 E. None of these

3. Deficit financing increases—

A. Rate of money inflation B. Rate of money deflation C. Rate of devaluation D. All of the above E. None of these

4. Which is not a monetary measure to control inflation ?

A. Soft loan policy B. Hard credit policy C. Tighten the regulations of money issue D. To reduce the quantity of money E. None of these

5. Which is the monetary measure to control inflation ?

A. Increase in taxation B. Decrease in taxation C. Soft credit policy D. Hard credit policy E. None of these

6. Selling of securities in the open market by the central bank creates—

A. Inflation B. Deflation C. Both of the above D. None of the above E. None of these

7. To control inflation the central bank should —

A. Sell government securities and decrease bank rate B. Sell government securities and increase bank rate C. Purchase government securities and increase bank rate D. Purchase government securities and to decrease bank rate E. None of these

8. “Smart Money” is a term used for—

A. Internet Banking B. Credit Card C. Cash with Bank D. Cash with Public E. None of these

9. When was RBI nationalised ?

A. 1st April, 1935 B. 1st January, 1949 C. 1st January, 1935 D. 1st July, 1969 E. None of these

10. How many banks are there in public sector at present ?

A. 28 B. 27 C. 19 D. 20 E. None of these

Answers
1. Answer - Option D
2. Answer - Option D
3. Answer - Option A
4. Answer - Option A
5. Answer - Option D
6. Answer - Option B
7. Answer - Option B
8. Answer - Option B
9. Answer - Option B
10. Answer - Option B

1. The central banking functions in India are performed by the I. Central Bank of India II. Reserve Bank of India III. State Bank of India IV. Punjab National Bank

A. I, II and III B. II C. I D. II and IV E. None of these

2. ICICI is the name of a

A. chemical industry B. bureau C. corporation D. financial institution E. None of these

3. If all the banks in an economy are nationalized and converted into a monopoly bank, the total deposits

A. will decrease B. will increase C. will neither increase nor decrease D. None of the above

4. The association of the rupee with pound sterling as the intervention currency was broken in

A. 1990 B. 1991 C. 1992 D. 1993 E. None of the above

5. On July 12, 1982, the ARDC was merged into

A. RBI B. NABARD C. EXIM Bank D. HDFC Bank E. None of these

6. If the cash reserve ratio is lowered by the RBI, its impact on credit creation will be to

A. increase it B. decrease it C. no impact D. constant E. None of these

7. Which of the following items would not appear in a company's balance sheet?

A. Value of stocks of raw materials held B. Total issued capital C. Revenue from sales of the company's products D. Cash held at the bank E. None of these

8. The currency convertibility concept in its original form originated in

A. Wells Agreement B. Bretton Woods Agreement C. Taylors Agreement D. Both a and b E. None of these

9. The central co-operative banks are in direct touch with

A. farmers B. state co-operative banks C. land development banks D. central government E. None of these

10. The first wholly Indian Bank was set up in

A. 1794 B. 1894 C. 1896 D. 1902 E. None of these

Answers
1. Answer - Option B
2. Answer - Option D
3. Answer - Option C
4. Answer - Option C
5. Answer - Option B
6. Answer - Option A
7. Answer - Option C
8. Answer - Option B
9. Answer - Option B
10. Answer - Option B

1. Our financial system has provided for the transfer of resources from the centre to the states; the important means of resource transfer are

A. tax sharing B. grant-in-aids C. loans D. All the above E. None of these

2. In pursuance of the recommendations of Narsimhan Committee, the RBI has framed new guidelines

A. to govern entry of new private sector banks to make the banking sector more competitive B. to reduce the freedom given to banks to rationalize their existing branch network C. to set up more foreign exchange banks D. to lend more easily for industrial development E. None of these

3. Deficit financing means that the government borrows money from the

A. RBI B. local bodies C. big businessmen D. IMF E. None of these

4. The co-operative credit societies have a

A. two-tier structure B. three-tier structure C. four-tier structure D. five-tier structure E. None of these

5. Regional rural banks I. have limited area of operation II. have free access to liberal refinance facilities from NABARD III. are required to lend only to weaker sections

A. I, III B. II, III C. I, II, III D. I, II E. None of these

6. The Board of Industrial and Financial Reconstruction (BIFR) came into existence in

A. 1984 B. 1986 C. 1987 D. 1989

7. The banks are required to maintain a certain ratio between their cash in hand and totals assets. This is called

A. Statutory Bank Ratio (SBR) B. Statutory Liquidity Ratio (SLR) C. Central Bank Reserve (CBR) D. Central Liquid Reserve (CLR) E. None of these

8. How banks were nationalized in 1969?

A. 16 B. 14 C. 15 D. 20 E. None of these

9. The accounting year of the Reserve Bank of India is

A. April-March B. July-June C. October-September D. January-December E. None of these

10. In India, the first bank of limited liability managed by Indians and founded in 1881 was

A. Hindustan Commercial Bank B. Oudh Commercial Bank C. Punjab National Bank D. Punjab and Sind Bank E. None of these

Answers
1. Answer - Option D
2. Answer - Option A
3. Answer - Option A
4. Answer - Option B
5. Answer - Option D
6. Answer - Option C
7. Answer - Option B
8. Answer - Option B
9. Answer - Option A
10. Answer - Option B

1. If the RBI adopts an expansionist open market operations policy, this means that it will

A. buy securities from non-government holders B. sell securities in the open market C. offer commercial banks more credit in the open market D. openly announce to the market that it intends to expand credit E. None of these

2. Which of the following is NOT the name of a multinational bank?

A. BNP Paribas B. British Bank of Middle East C. Standard Chartered Bank D. HSBC E. Cathay Pacific

3. In order to avoid crowding of customers wanting to withdraw cash in the branches, banks have provided many delivery channels. Which of the following is one of the most popular channels of getting instant hard cash?

A. Core Banking Solution B. Pay Orders C. Demand Drafts D. Automated Teller Machines E. None of these

4. As we all know, when we deposit a cheque issued in our name in the bank, the bank always checks if the cheque has been crossed or not. Why is this done?

A. It ensures that the money is deposited only in the account of the person in whose name the cheque has been drawn. B. It is a process by which the person who has issued the cheque comes to know whether the cheque is encashed or not. C. The bank insists on it only when the party wants the payment immediately and that too in cash only. D. This is the instruction of RBI that all the cheques of the amount of 10,000 should be accepted only if they are crossed. E. None of these

5. Which of the following terms is NOT associated with banking operations?

A. Repo Rate B. Prime Lending Rate C. Equator D. Corporate Finance E. Cash Reserve Ratio

6. A student has got admission to a foreign university. From where can he/she get the foreign currency ?

A. From the Bank of that country only B. From the Ministry of Foreign Affairs C. From office of the Consulate General of that country D. From an authorised foreign exchange dealer E. From any big five star hotel as many foreigners come to stay there

7. What is the full form the term 'FDIs' as used in the economic world?

A. Fixed Duration Investments B. Financial and Debt Instruments C. Foreign Deployment Index D. Foreign Direct Investments E. Formal Direct Issues

8. Which of the following is NOT a Govt. sponsored organization?

A. Small Industries Development Bank of India B. NABARD C. National Housing Bank D. ICICI Bank E. All are Govt. sponsored

9. Which of the following is the apex institution which handles refinance for agriculture and rural development in India?

A. RBI B. SIDBI C. NABARD D. SEBI E. None of these

10. Which of the following is NOT a part of India's Money Market?

A. Bill Market B. Call Money Market C. Banks D. Mutual Funds E. Indian Gold Council

Answers
1. Answer - Option C
2. Answer - Option E
3. Answer - Option D
4. Answer - Option A
5. Answer - Option C
6. Answer - Option D
7. Answer - Option D
8. Answer - Option D
9. Answer - Option C
10. Answer - Option E

1. Which of the following is the Regulator of the credit rating agencies in India?

A. RBI B. SBI C. SEBI D. SIDBI E. All of the above

2. Bank rate is decided by which of the following?

A. RBI B. Govt. of India C. SEBI D. IBA E. NABARD

3. FDI refers to –

A. Fixed Deposit Interest B. Fixed Deposit Investment C. Foreign Direct Investment D. Future Derivative Investment E. None of these

4. Teaser Rates are related to which of the following types of loans?

A. Home Loans B. Personal Loans C. Auto Loans D. Reverse Mortgage Loans E. Crop Loans

5. As we all know, the major source of income of the banks is lending money (providing credit) and earning interest on it. In normal circumstances, the demand of the credit comes mainly from which of the following sectors? (A) Personal Loans (B) Priority Sector Lending and Bailout Packages (C) Project Finance

A. Only (A) B. Only (B) C. Only (C) D. Only (A) (b) Only (B) E. None of these

6. Many banks have launched/floated their subsidiaries which are fully owned by them. Banks launch subsidiaries normally for which of the following businesses? (A) Home Loan Business (B) To sell Insurance Policies (C) To control Online Operations or Internet Banking business

A. Only (A) B. Only (B) C. Only (C) D. Only (A) (b) Only (B) E. None of these

7. "The set of directive principles issued by the Central Bank of a country or the process adopted by it to control the supply of money, availability of money, cost of money and rate of interest, etc, in order to bring stability and growth of the economy" are commonly known as

A. Monetary policy of the Central Bank of the country B. Budget of the Govt C. Profit and Loss Account D. Business Policy of the Bank E. None of the above

8. Consider the following statements: 1. In call money market, funds are borrowed and lent for one day and for a period of up to 14 days without any collateral security. 2. Ways and Means Advances are made the commercial banks to maintain mandatory reserves. 3. Treasury Bills are promissory notes issued by State Governments for fixed period extending up to one year. Which of the above statement/s is/are correct?

A. Only (1) B. Only (1) and (2) C. Only (3) D. Only (1) and (3) E. All the above

9. Consider the following statement/s about ‘Open Market Operations’ is/are true: 1. ‘Open Market Operation’ stands for the purchase and sale of government securities by the RBI from/ to the public and banks. 2. The RBI buys all the unsold stock new government loans at the end of the subscription period. 3. Such purchases of the government securities by the RBI constitute only an internal arrangement and are not genuine market purchases.

A. Only (1) B. Only (1) and (2) C. Only (2) and (3) D. Only (3) E. All the above are true

10. When the Reserve-Bank says that the Rupee is over-valued, it means

A. RBI has shortage of hard currency and it has to order for printing of new notes to the press concerned B. Rupee is appreciating against other currencies whereas other currencies are weakening against US Dollar C. Money is locked in banks and people do not have enough to make their day to day purchases. It is a strategy which brings the inflation down D. More and more people are selling their stocks. As a result stock market may crash, as there is no hard cash for such voluminous transactions E. None of the above

Answers
1. Answer - Option C
2. Answer - Option A
3. Answer - Option C
4. Answer - Option A
5. Answer - Option C
6. Answer - Option D
7. Answer - Option A
8. Answer - Option A
9. Answer - Option E
10. Answer - Option E

1. RBI's open market operation transactions are carried out with a view to regulate

A. liquidity in the economy B. prices of essential commodities C. inflation D. borrowing power of the banks E. All of the above

2. The bank rate means

A. rate of interest charged by commercial banks from borrowers B. rate of interest at which commercial banks discounted bills of their borrowers C. rate of interest allowed by commercial banks on their deposits D. rate at which RBI purchases or rediscounts bills of exchange of commercial banks E. None of the above

3. What is an Indian Depository Receipt?

A. A deposit account with a Public Sector Bank B. A depository account with any depositorys in India C. An instrument in the form of depository receipt created by an Indian depository against underlying equity shares of the issuing company D. An instrument in the form of deposit receipt issued by Indian depositories E. None of the above

4. An instrument that derives its value from a specified underlying currency, gold, stocks etc, is known as

A. Derivative B. Securitisation Receipt C. Hedge Fund D. Factoring E. Venture Capital Funding

5. Reverse repo means

A. injecting liquidity by the Central Bank of a country through purchases of Govt. securities B. absorption of liquidity from the market by sale of Govt. securities C. balancing liquidity with a view to enhance economic growth rate D. improving the position to availability of the securities in the market E. None of the above

6. The stance of RBI monetary policy is

A. inflation control with adequate liquidity for growth B. improving credit quality of the banks C. strengthening credit delivery mechanism D. supporting investment demand in the economy E. None of the above

7. Currency Swap is an instrument to manage

A. currency risk B. interest rate risk C. currency and interest rate risk D. cash flows in different currencies E. All of the above

8. Euro Bond is an instrument

A. issued in the European market B. issued in Euro currency C. issued in country other than the country of the currency of the Bond D. All of the above E. None of the above

9. Money Laundering normally involves

A. placement of funds B. layering of funds C. integration of funds D. All of (a), (b) and (c) E. None of (a), (b) and (c)

10. The IMF and the World Bank were conceived as institutions to

A. strengthen international economic co-operation and to help create a more stable and prosperous global economy B. Promote international monetary cooperation C. Promote long term economic development and poverty reduction D. All of (a), (b) and (c) E. None of (a), (b) and (c)

Answers
1. Answer - Option E
2. Answer - Option D
3. Answer - Option C
4. Answer - Option A
5. Answer - Option A
6. Answer - Option A
7. Answer - Option D
8. Answer - Option C
9. Answer - Option D
10. Answer - Option D

1. Capital Market Regulator is

A. RBI B. IRDA C. NSE D. BSE E. SEBI

2. What is the Call Money?

A. Money borrowed or lent for a day or overnight B. Money borrowed for more than one day but upto 3 days C. Money borrowed for more than one day but upto 7 days D. Money borrowed for more than one day but upto 14 days E. None of the above

3. Which of the following is the Regulator of the credit rating agencies in India ?

A. RBI B. SBI C. SIDBI D. SEBI E. None of these

4. The logo of Bank of Baroda is known as

A. Sun of Bank of Baroda B. Baroda Sun C. Bank of Baroda's Rays D. Sunlight of Bank of Baroda E. None of the above

5. Many times we read about Future Trading in newspapers. What is 'Future Trading' ? (A) It is nothing but a trade between any two stock exchanges where in it is decided to purchase the stocks of each other on a fixed price throughout the year (B) It is an agreement between two parties to buy or sell an underlying asset in the future at a predetermined price (C) It is an agreement between stock exchanges that they will not trade the stocks of each other under any circumstances in future or for a given period of time

A. Only A B. Only B C. Only C D. All A, Band C E. None of these

6. The expansion for the abbreviation BIS, in the context of the banking industry is

A. Bank for International Settlements B. Bank for Industrial Settlements C. Bank for Industrial Sectors D. Bank for International Services E. None of these

7. As per the guidelines issued by the SEBI the Permanent Account Number (PAN) is a must for which of the following?

A. Demat Accounts B. All Saving Banks Accounts C. All Housing Loan Accounts D. All Current Accounts E. None of these

8. Which of the following names is not associated with the insurance business in India?

A. Bajaj Allianz B. GIC C. LIC D. GE Money E. None of these

9. Which of the following is not a public sector unit/ undertaking/agency?

A. ECGC B. SIDBI C. SEBI D. Axis Bank E. None of these

10. CRR stands for

A. Cash Rate Requirements B. Cash Reserve Ratio C. Credit Rate Requirements D. Credit Reserve Requirements E. None of these

Answers
1. Answer - Option E
2. Answer - Option A
3. Answer - Option D
4. Answer - Option B
5. Answer - Option B
6. Answer - Option A
7. Answer - Option A
8. Answer - Option D
9. Answer - Option D
10. Answer - Option B

1. Green Banking means

A. financing of irrigation projects by banks B. development of forestry by banks C. financing of environment friendly projects by banks D. Managing fishery by banks E. None of these

2. The Securities and Exchange Board of India (SEBI) and the Reserve Bank of India have given guidelines to enable trading in currency derivatives on stock exchanges. Which of the following statements is/are TRUE in this context? A. Any bank is eligible to become a clearing member and/ or a trading member of the currency derivatives segment of an exchange. B. The last day for trading of the contract shall be two working days prior to the final settlement day. C. Currency futures are permitted now only in U.S. dollarIndian Rupee.

A. Only A B. Only C C. Both A & B D. All A, B & C E. None of these

3. Fiscal deficit in the Union Budget means

A. The difference between crucial expenditure and current revenue. B. The sum of budgetary deficit and net increase in internal and external borrowings C. Net increase in union government borrowings from Reserve Bank of India D. The sum of monetized deficit and budgetary deficit. E. None of these

4. Free international trade leads to equalization of

A. prices in both the countries B. international price with domestic price C. commodities of both the countries D. Trade between two countries E. None of the above

5. Which one of the following is not a quantitative control method of credit control?

A. Cash reserve Ratio B. Statutory Liquidity Ratio (SLR) C. Bank – Rate D. Selective Credit Control E. None of these

6. The RBI has helped to finance India’s foreign trade through

A. IDBI B. SBI C. EXIM Bank D. NABARD E. None of these

7. When the price of a substitute of a commodity X falls, then the demand for X

A. Rises B. Falls C. Remains unchanged D. First rises and then falls E. None of these

8. The provision of credit and other financial services and products of very small amount to the poor in rural semi urban and urban areas to enable them to raise their income level and living standard is known as

A. Micro Credit B. Personal Banking C. Corporate Banking D. Non-Banking Finance E. None of these

9. Who among the following is known as the guardian of the ‘Public Purse’ in India?

A. The President B. The Comptroller and Auditor General C. The Finance Minister D. The Parliament E. None of these

10. The National Stock Exchange functions from

A. New Delhi B. Kolkata C. Mumbai D. Chennai E. None of these

Answers
1. Answer - Option C
2. Answer - Option D
3. Answer - Option B
4. Answer - Option D
5. Answer - Option D
6. Answer - Option C
7. Answer - Option B
8. Answer - Option A
9. Answer - Option B
10. Answer - Option C