Choose
the most appropriate answer
1.
Public
Expenditure refers to ...........
|
|
(a) Government Expenditure
|
(b) Private Expenditure
|
|
|
|
|
(c) Private Expenditure
|
(d) None of the above
|
|
|
|
2.
|
The major objectives of public expenditure are
.......
|
|
||
|
|
(a) Economic Growth
|
|
(b) Maintenance of Defence
|
|
|
|
(c) Social Welfare
|
|
(d) All of the above
|
|
|
3.
|
The defense expenditure minimizes the
possibility of .....
|
|
||
|
|
(a) External threats
|
|
(b) Internal threats
|
|
|
|
(c) Terrorism
|
|
(d) All of the above
|
|
|
4.
|
An empirical law to the
effect of growing public expenditure was propounded by
|
|||
|
|
(a) Wagner
|
(b) Peacock (c) Wiseman
|
(d) None of these
|
|
|
5.
|
According to H.C. Adams' public expenditure
has to perform the ....
|
|||
|
|
(a) Protective Function
|
(b) Commercial Function
|
||
|
|
(c) Developmental Function
|
(d) All of the above
|
|
|
[Ans: 1.
(a), 2. (d), 3. (d), 4. (a), 5. (d)]
Choose the most appropriate
answer
1. Productive debts are utilized for .........
a) Transfer payments in form of subsidies
b) They are raised for financing wars
c) They add to productive capacity of the economy
d) special incentives to weaker sections
2. External debts can be raised from ...........
(a) Individuals (b) RBI
(c) Commercial
Banks (d) World Bank
3. The treasury bills are issued by RBI on
behalf of the government
(a) Short-term
public debt (b) Medium-term public debt
(c) Long-term public (d) None of the
above
|
4.
|
Debts that are repaid at
some specific future date are known as
|
||
|
|
(a) Redeemable debts
|
(b) Irredeemable debts
|
|
|
|
(c) Treasury Bill
|
(d) None of the above
|
|
|
5.
|
External loans are raised from
|
|
|
|
|
(a) IDBI
|
(b) ICICI
|
|
|
|
(c) RBI
|
(d) WTO
|
|
[Ans: 1.
(b), 2. (d), 3. (a), 4. (a), 5. (d)]
Choose the most appropriate
answer
1. The term Fiscal Federalism was introduced by
(a)
Musgrave (b) Oates (c)
Dalton (d) None of the above
2. Fiscal federalism deals with .............
a) The division of governmental functions
b) Financial relations among levels of government
c) Proper allocation of Resources
d) All of the above
3. The main pillars of institutional framework to
deal with centre-state financial relations in
|
|
India is .........
|
|
|
|
(a) Finance Commission
|
(b) Planning Commission
|
|
|
(c) National Development Council
|
(d) All of the above
|
|
4.
|
Under Article 246 and
Seventh Schedule, List I invest the Union with functions of
|
|
|
|
(a) National Importance
|
(b) State Importance
|
|
|
(c) Local Importance
|
(d) All of the above
|
|
5.
|
Under Article 246 and
Seventh Schedule, List II invest the State with functions of
|
|
|
|
(a) National Importance
|
(b)
|
|
|
(c) External Affairs
|
(d) Public Health
|
[Ans:
1(a), 2. (d), 3. (d), 4. (a), 5. (d)]
True and False
1.
Money
Market deals with long term monetary transactions.
2. Money market promotes economic growth.
3. Fall in interest rate cause the rate causes the
bond prices also to fall.
4. Credit rating agencies determine interest rates
on debt securities.
5. Capital Market deals with long term monetary
transactions.
6. A fall in interest rates reduces the demand for
bonds in the secondary market.
7. There exist too many interest rates in the
Indian money market.
8. Increasing Government borrowing will raise
interest rates.
9. Capital market also provides a valuable source
of external finance.
10.
Capital
market does not provide an effective source of investment in the economy.
[Ans.:
True : 2, 5, 6, 7, 8, 9 ; False: 1, 3, 4,10]
true or false:
1.
Money
market is a market for lending and borrowing of long-term funds.
2.
The
organized money market comes within the direct purview of government
regulation.
3.
The
organized money market is a single market.
4.
The call
rate is determined by demand and supply of short-term funds.
5.
The
commercial bill market in India is underdeveloped.
6.
The
certificates of deposits are issued by corporates.
7.
Repo
operations inject liquidity into the financial system.
8.
Reverse
repo operation absorbs the excess liquidity out from the system.
[Ans.: False, False, False,
True, True, False, True, True]
true or false :
1.
There is
no integration between the organized and unorganized sectors of the money
market.
2.
Indian
money market has single uniform interest rate in all the segments.
3.
In India
the bill market is not yet fully developed.
4.
From
1989, interest rates in money market were controlled by the RBI.
5.
Only
business corporates are allowed to invest in MMMFs.
[Ans.:
True, False, True, False, False]
true or false :
1.
The
capital market is the market for medium and long-term funds.
2.
Capital
market not only mobilizes savings but also channelizes them into investments.
3.
Capital
market does not contribute towards modernization of industries.
4.
The capital market does not serve as a reliable guide to the performance
and financial position of companies.
5.
Financial intermediaries such as mutual funds, merchant banks, leasing
companies, etc. are part of capital market.
6.
Primary
market deals with securities already issued.
[Ans.
True; True; False; False; True; False]
true or false :
1. The SEBI is under the overall control of RBI.
2. SEBI is not responsible for capital market
surveillance.
3. On the recommendation of
the Narasimham Committee (1991), the government abolished the post of
controller of capital issue (CCI).
4. Screen based trading leads to improved
operational efficiency in the secondary market.
5.
Business corporates are allowed to determine par
values of shares issued by them.
6. NSE is fully owned by the Government of India.
7. Retail investors are not allowed to trade in
Central Government Securities.
[Ans.
False; False; True; True; True; False; False]
Choose the appropriate answers
1.
Money
market has to provide facility for adjusting liquidity to
a) banks
b) business corporations
c) non-banking financial institutions
d) All the above
2.
Gilt
edged securities refer to
a) Government Securities
b) Securities issued by municipal corporations
c) Securities issued by first class companies
d) None of these
3.
E.P.S in
share market stands for
c) Employee Pension Scroll d) Equated Payment System
4.
Which of
the following is not an organized sector in India?
a) Nationalized
Bank b)
Regional Rural Banks
c) Cooperative
Banks d) Chits and Money lenders
5.
C.R.A.
in banking parlance stands for
a) Credit
Rating Association b) Credit Rating Agency
c) Credit Risk
Assessment d) None of these
6.
The
period for Call Money is____________ .
c) 15 to 30 Days d) One Month
7.
Which of
the following statement regarding S.E.B.I is not correct?
a) It regulates the business in stock markets and
other securities markets.
b) It was set up in 1988 and given statutory
recognition in 1992.
c) It fixes prices of I.P.Os (Initial Public Offer)
in the stock market.
d) It regulates substantial acquisition of shares
and takeover of companies.
8.
Certificates
of deposits are issued by :
c) Local area banks d) All of the above
9.
Which of
the following is not a part of the organised sector of the Indian money market?
a) Commercial banks b)
Foreign banks
c) Chit funds d) Mutual funds
10.
Industrial
Securities Market is a market for shares and debentures of –
c) Both (a) and (b) d) None of the above
[Ans.:
(1 - d), (2 - c), (3 - a), (4 - c), (5 - c), (6 - b), (7 - c), (8 - a), (9 -
c), (10 - c)]
Multiple Choice Questions:
1. Which of the following is a part of the organized sector or Indian
money market ?
(a) Indigenous
bankers (b) Loan
companies
(c) Call money
market (d) Moneylenders
2. Which of the following is not the main player of Indian money market
?
(a) Government (b) RBI
(c) Commercial
banks (d) Over
the Counter Exchange of India
3. Which of the following are the main participants in the call money
market ?
(a) Commercial banks (b)
Co-operative banks
(c) Primary dealers (d) All the above
4. Which of the following does
not form the part of treasury bills issued by the government of India today?
(a) 14-day
treasury bills (b)
91-day treasury bills
(c) 182-day
treasury bills (d)
364-day treasury bills
5 . Which of the following is not the feature of commercial bills?
|
|
(a) Short term
|
(b) Trade bills
|
|
|
(c) Issued by RBI
|
(d) High degree of liquidity
|
|
6.
|
Which of the following
money market instrument is issued by commercial® banks ?
|
|
|
|
(a) CPs
|
(b) Commercial bills
|
|
|
(c) CDs
|
(d) Treasury bills
|
|
7.
|
Which of the following measures absorb
liquidity from the financial system?
|
|
|
|
(a) Repo
|
(b) Reverse repo
|
|
|
(c) MSF
|
(d) Buying of securities under OMO
|
[Ans:
(1) - (c), (2) - (d), (3) - (d), (4) - (a), (5) - (c), (6) - (c), (7) - (b)]
Choose the correct answer :
1. Which of the following is
the latest measure introduced by RBI to influence liquidity in the financial
system?
|
(a) Repo
|
(b) Reverse repo
|
(c) MSF
|
(d) LAF
|
|
|
2.
|
Money market in India suffers from
|
|
||
|
(a) Insufficient funds
|
(b) Excess regulation by the
government
|
|||
|
(c) Insufficient demand for money
|
(d) None of the above
|
|||
|
3.
|
Indian money market is
|
|
|
|
|
(a) Fully integrated
|
|
(b) suffering from dichotomy
|
||
|
(c) Well organized and fully developed
|
(d) None of the above
|
|||
|
4.
|
RBI introduced reverse
repos in
|
|
|
|
|
|
(a) 1992
|
|
(b) 1996
|
|
|
|
(c) 2002
|
|
(d) None of the above
|
|
|
5. The minimum lack in period for MMMF is
|
|
|||
|
|
(a) 30 days
|
(b) 45 days
|
||
|
|
(c) 15 days
|
(d) None of the above
|
||
|
6.
|
The Clearing Corporation of India Limited
(CCIL) deals with
|
|||
|
|
(a) Government securities
|
(b) CDs
|
|
|
|
|
(c) CPs
|
|
(d) None of the above
|
|
[Ans.
(1) - (c), (2) - (a), (3) - (b), (4) - (b), (5) - (c), (6) - (a)]
Choose the correct answer
|
1.
|
Capital market is a market for
|
|
|
|
(a) Short term funds
|
(b) Long term funds
|
|
|
(c) Medium term funds
|
(d) Medium and long term funds
|
|
2.
|
Which of the following is
not an important segment of capital market ?
|
|
|
|
(a) Gilt edged market
|
(b) Corporate debt market
|
|
|
(c) Equity market
|
(d) RBI
|
3. The process of capital formation involves
(a) Savings and its mobilization (b) Moneylenders
|
|
(c) Commercial banks
|
(d) None of the above
|
|
|
4.
|
Which of the following is not the role of
capital market?
|
||
|
|
(a) Mobilization of savings
|
|
(b) Industrial development
|
|
|
(c)Channelization of funds for investment
|
(d)Development of
commercial banking
|
|
|
5.
|
Which of the following do not constitute the
structure of capital market s India ?
|
||
|
|
(a) Gilt-edged market
|
(b) Industrial securities market
|
|
|
|
(c) RBI
|
(d) Mutual funds
|
|
|
6.
|
The primary market does not include
|
|
|
|
|
(a) Equity issues
|
(b) GDR issues
|
|
|
|
(c) Screen based trading
|
(d) Debt issues
|
|
[Ans.
(1) - (d), (2) - (d), (3) - (a), (4) - (d), (5) - (c), (6) - (c)]
Choose
the correct answer :
1. Which of the following measures constitutes
primary market reforms?
|
|
a) Abolition of controller of capital issues
b) Setting up of NSE
|
|
|
|
c)
Setting up of OTCEI
|
d) None of the above
|
|
2.
|
Secondary market reforms do not include
|
|
|
|
a) Screen based trading
|
b) LAF
|
|
|
c) Depository system
|
d) Rolling settlement
|
|
3.
|
Foreign Institutional Investors (FIIs) are
allowed to invest in
|
|
|
|
a) only equity shares
|
b)only debt market
|
|
|
|
c) both the above markets
|
d) None of above
|
|
|
4.
|
The Over the Counter
Exchange of India (OTCEI) allows the companies to register only in
|
||
|
|
a) OTCEI
|
b) OTCEI and NSE
|
|
|
|
c) OTCEI and BSE
|
d) None of above
|
|
|
5.
|
Mutual Funds play an important role in Indian
capital market as
|
||
|
|
a) Speculator in stock
market
|
|
b) Investment avenue for small investors
|
|
|
c) Promoter of large scale
industries
|
d)None of above
|
|
[Ans.
(1) - (a), (2) - (b), (3) - (c), (4) - (a), (5) - (b)]
0 Comments