Friday, January 20, 2012

Finance Quiz - 2

1. Market Capitalisation is _____________.    
[A]Value of shares of the company held by Foreign Investors
[B]No. of shares issued by a company multiplied by it's market price
[C]Value of shares held by promoters of the company
[D]Value of shares in the company held by the public

2. What is the present value of Rs 10000 receivable after 1 year discounted at 10% p.a.?    

3. What factor/s affect the interest rate?    
[A]Government borrowings
[B]Supply of money
[C]Inflation rate
[D]All of the above

4. Which of the following needs to be considered by an investor, while investing?    
[A]Assess risk-return profile of the investment.
[B]Know the liquidity and safety aspects of the investment.
[C]Obtain written documents explaining the investment.
[D]All of the above

5. Money market mutual funds can invest in _______.    
[A]treasury bills
[B]certificate of deposits
[C]commercial paper
[D]All of the above

6. Which of the following is not true about a debt instrument?    
[A]It signifies a ownership right in the company.
[B]It carries interest paying obligation.
[C]It has a fixed maturity.
[D]None of the above

7. Which type of corporate action splits the existing shares of a particular face value into smaller denominations?    
[A]Stock Split
[B]Bonus Issue
[C]Buy Back
[D]Right Issue

8. How many securities are there in Nifty index?    

9. Which of the following is TRUE about Primary Markets?    
[A]Primary Markets are markets where commodities are sold.
[B]Primary Market is the place where public can buy and sell securities from one another.
[C]Primary Markets refer to the mobilization of funds from the public by corporates through the       issue of shares / debentures.
[D]Primary Markets are places where only short term instruments are traded.

10. The future value of a Rs.10,000 investment done today, which gives an annual rate of return of 20% per annum, after one year should be ____________.    
[A]Rs. 12,200
[B]Rs. 12,500
[C]Rs. 12,000
[D]Rs. 12,640

11. Which of the following problems have been eliminated by Depositories?   
[A]Reduction in the share transfer time to the buyer.
[B]Risk of stolen, fake, forged shares.
[C]Stamp duty on transfer of shares in dematerialized form.
[D]All of the above

12. Which of the following is not a benefit of investing in mutual funds?    
[A]Investment in Mutual funds leads to diversification of holdings.
[B]Mutual funds are managed by professional fund managers.
[C]Mutual Funds regularly provide investors with information on the value of their investments.
[D]None of the above

13. Funds which invest only in the stocks comprising an index and aim to give returns commensurate with the index returns are called _________.    
[A]Index Funds
[B]Active Funds
[C]Dormant Funds
[D]None of the above

14. Depositories are like banks for securities.   
[C]Dormant Funds
[D]None of the above

15. At 12% annual inflation rate, an item costing Rs. 100 today, would cost Rs. _______ after one year.    
[A]Rs. 114
[B]Rs. 112
[C]Rs. 102
[D]Rs. 113