1.
After the trade has been executed, the broker issues a Contract Note to the
investor within _____.
(a) 52 hours
(b) 24 hours
(c) 48 hours
(d) 12 hours
Answer (b) 24 hours
2. On this day, the exchange will deliver the share or make payment to the other
broker, _____.
(a) Pay-in day
(b) Pay-out day
(c) Transaction day
(d) None of the above
Answer: (b) Pay-out day
3. The mandatory detail that an investor has to provide to the broker at the time of
opening a Demat account is _____.
(a) Date of birth and address
(b) PAN number
(c) Residential status (Indian/NRI)
(d) Bank account details.
Answer: (b) PAN number
4. Identify the correct sequence of steps to be followed in the trading procedure at
the Stock Exchange.
(a) Opening a trading account and Demat account, Placing an order, Settlement of
order, Execution of order
(b) Settlement of order, Opening a trading account and Demat account, Placing an
order, Execution of order
(c) Opening a trading account and Demat account, Placing an order, Execution of
order, Settlement of order
(d) Placing an order, Opening a trading account and Demat account, Execution of
order, Settlement of order
Answer: (c) Opening a trading account and Demat account, Placing an order,
Execution of order, Settlement of order
5. It serves as an intermediary between the investor and the depository who is
authorised to maintain the accounts of dematerialised shares.
(a) Depository participant
(b) Depository
(c) Stock exchange
(d) None of the above
Answer: (a) Depository participant
6. One of the common irregularities noted by the Securities and Exchange Board of
India during the inspection of a stock exchange was that it was dealing with
unregistered sub-brokers. Identify the related function of the Securities and
Exchange Board of India _____.
(a) Regulatory function
(b) Protective function
(c) Developmental function
(d) None of the above
Answer: (a) Regulatory function
7. Stock exchanges provide an opportunity for investors to disinvest and invest.
Identify the related function of the stock exchange.
(a) Providing scope for speculation
(b) Providing liquidity and marketability to existing securities
(c) Pricing of security
(d) Spreading of the equity cult
Answer: (b) Providing liquidity and marketability to existing securities
8. Stock Exchange works as a mechanism for the valuation of securities through the
forces of demand and supply. Identify the related function performed by the stock
exchanges.
(a) Providing liquidity and marketability to existing securities
(b) Safety of transaction
(c) Pricing of security
(d) Spreading of the equity cult
Answer: (c) Pricing of security
9. Under this method of floatation in the primary market, a subscription is invited from
the general public to invest in the securities of a company through the issue of
advertisement.
(a) Private placement
(b) Offer through a prospectus
(c) Offer for sale
(d) All of the above
Answer: (b) Offer through a prospectus
10. They can be issued to individuals, corporations, and companies during periods of
tight liquidity when the deposit growth of banks is slow, but the demand for credit is
high.
(a) Commercial papers
(b) Call money
(c) Commercial bill
(d) Certificate of deposit
Answer: (d) Certificate of deposit
11. A company can raise capital through the primary market in the form of _____.
(a) Equity shares
(b) Preference shares
(c) Debentures
(d) All of the above
Answer: (d) All of the above
12. It is a short-term, negotiable, self-liquidating instrument that is used to finance
the credit sales of firms.
(a) Commercial bill
(b) Commercial papers
(c) Call money
(d) None of the above
Answer: (a) Commercial bill
13. It is a method by which banks borrow from each other to be able to maintain the
cash reserve ratio.
(a) Commercial bill
(b) Commercial papers
(c) Call money
(d) None of the above
Answer: (c) Call money
14. Who issues a treasury bill?
(a) Any nationalised bank
(b) Any private sector bank
(c) Reserve Bank of India
(d) All of the above
Answer: (c) Reserve Bank of India
15. It is a market for short-term funds that deals in monetary assets whose period of
maturity is up to one year.
(a) Primary market
(b) Secondary market
(c) Capital market
(d) Money market
Answer: (d) Money market