Q1. Who can invest in a commercial paper?
A. Individuals
B. Banking Companies
C. Corporate bodies registered or incorporated in India and unincorporated bodies, Non- Resident Indians (NRIs) and Foreign Institutional Investors (FIIs)
D. All of the above
E. None of the given options is true
Answer: Option D
Explanation:
All residents and non-residents permitted to invest in CPs under Foreign Exchange Management Act (FEMA), 1999 are eligible to invest in CPs; however, no person can invest in CPs issued by related parties either in the primary or secondary market. Investment by regulated financial sector entities will be subject to such conditions as the concerned regulator may impose.
Q2. The committee on Banking Regulations and Supervisory Practices which released the agreed frame work on international convergence of capital measures and capital standards in July 1988 is popularly known as _______.
A. Vaz Committee
B. Cooks Committee
C. Basel Committee
D. Rao Committee
E. None of the given options is true
Answer: Option D
Explanation:
The document has been incorporated in the comprehensive version of International Convergence of Capital Measurement and Capital Standards: A Revised Framework, including the elements of the 1988 Accord that were not revised during the Basel II process, the 1996 Amendment to the Capital Accord to Incorporate Market Risks, and the 2005 paper on The Application of Basel II to Trading Activities and the Treatment of Double Default Effects.
Q3. In present, Reverse Repo rate is the rate at which RBI Pays interest to Commercial Banks and it is linked to Repo Rate and the rate is-?
A. 1% above Repo Rate
B. 0.25% below Repo Rate
C. Same as Repo Rate
D. 1% below Repo Rate
E. 0.25% above Repo Rate
Answer: Option B
Explanation:
Policy Repo Rate: 5.40% and Reverse Repo Rate: 5.15%.
Q4. Which is the first Indian Private Sector Bank set up a branch in China?
A. ICICI Bank
B. Syndicate Bank
C. Axis Bank
D. HDFC Bank
E. State Bank of India
Answer: Option C
Explanation:
Axis Bank, the First Indian Private Sector Bank to Set up a Branch in China.
Q5. Which of the following rates is not decided by the RBI?
A. Bank Rate
B. Repo Rate
C. Reverse Repo Rate
D. Prime Lending Rate
E. None of the given options is true
Answer: Option D
Explanation:
Historically, prime lending rate is the interest rate at which banks lend to its most credit worthy customers. But, over the course of history, banks have come to lend to customers at interest rates below and above the prime lending rate. Prime lending rate of banks do not vary widely.