This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 10 Financial Markets – Quiz 21 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 10 Financial Markets Quiz 21 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What does "Forex" stand for? A) For Ex-Pats. B) Foreign Exchange. C) Foreign Market. D) For Example. Show Answer Correct Answer: B) Foreign Exchange. 2. Apa nama produk pinjaman yang disediakan oleh Pegadaian untuk usaha mikro, kecil, dan menengah (UMKM)? A) Multi Finance. B) Krasida (Kredit Angsuran Sistem Gadai). C) KUR (Kredit Usaha Rakyat). D) Gadai Konvensional. Show Answer Correct Answer: B) Krasida (Kredit Angsuran Sistem Gadai). 3. Which of the following is a function of financial intermediaries? A) Funding education. B) Mobilizing savings. C) Issuing currency. D) Promoting tourism. Show Answer Correct Answer: B) Mobilizing savings. 4. What is the market where previously issued securities are traded? A) Initial public offering. B) Over-the-counter market. C) Primary market. D) Secondary market. Show Answer Correct Answer: D) Secondary market. 5. A credit card is a form of: A) Plastic money. B) Token money. C) Fiat money. D) Legal tender. Show Answer Correct Answer: A) Plastic money. 6. The minimum period till which an equity investment must be retained in order to qualify as Long Term is: A) 1 year. B) 3 year. C) 4 year. D) 2 year. Show Answer Correct Answer: A) 1 year. 7. *Is a debt financial instrument that promises to make payments periodically for a specified period of time. A) Stock. B) Market. C) Coupon. D) Bond. Show Answer Correct Answer: D) Bond. 8. What assumption is made when comparing the term structure of interest rates? A) All characteristics except maturity are equal. B) All securities have the same interest rate. C) All securities are from the same issuer. D) All securities have the same tax rate. Show Answer Correct Answer: A) All characteristics except maturity are equal. 9. Formal contract to repay borrowed money and interest on the borrowed money at regular future intervals A) Futures contract. B) Financial system. C) Bond. D) Capital market. E) Equities. Show Answer Correct Answer: C) Bond. 10. What might indicate that a country's currency is likely to appreciate? A) Increasing foreign investment. B) Decreasing interest rates. C) High inflation rates. D) High unemployment rates. Show Answer Correct Answer: A) Increasing foreign investment. 11. Identify the instrument of Money Market:It is used by commercial and development and financial Institutions during the period when the deposit growth of a bank is slow but the demand for credit is high A) Commercial Bills. B) Call Money. C) Certificate of deposits. D) Commercial Papers. Show Answer Correct Answer: C) Certificate of deposits. 12. Investment company that pools people's money to make short-term loans to businesses and banks A) Mutual fund. B) Pension fund. C) Financial assets. D) None of the above. Show Answer Correct Answer: A) Mutual fund. 13. Salah satu fungsi pasar spot adalah ..... A) Mewakili ekspektasi pedagang mata uang dan bankir mengenai kurs spot mata uang di masa depan. B) Melakukan lindung nilai terhadap risiko nilai tukar atau untuk mendapatkan mata uang asing. C) Mengubah pendapatan yang dihasilkan dari penjualan di luar negeri menjadi mata uang negara asal mereka. D) Mengurangi risiko nilai tukarnya dan untuk mengunci nilai tukar di masa depan. Show Answer Correct Answer: C) Mengubah pendapatan yang dihasilkan dari penjualan di luar negeri menjadi mata uang negara asal mereka. 14. Financial services includes A) Call money market. B) Bill market. C) Leasing. D) None of the above. Show Answer Correct Answer: C) Leasing. 15. Through financial market, government and central bank can stabilize and regulate currency circulation, which help them ..... A) All of the above. B) Stabilize the exchange rate. C) Control inflation. D) Offset budget deficit. Show Answer Correct Answer: A) All of the above. 16. What role do financial markets play in resource allocation? A) Financial markets primarily focus on currency exchange rates. B) Financial markets are only relevant for large corporations. C) Financial markets do not influence individual investment choices. D) Financial markets allocate resources by determining asset prices through supply and demand, guiding investment decisions. Show Answer Correct Answer: D) Financial markets allocate resources by determining asset prices through supply and demand, guiding investment decisions. 17. Bank's make their profits primarily by issuing A) Equity. B) Negotiable CDs. C) Loans. D) NOW accounts. Show Answer Correct Answer: C) Loans. 18. Primary market facilitates business firms A) Short term finance. B) Indirect market. C) Medium term finance. D) New issue market. Show Answer Correct Answer: D) New issue market. 19. Which two banks have the highest weightage in Bank Nifty (as of latest data)? A) HDFC Bank & ICICI Bank. B) PNB and Bank of India. C) RBI and NABARD. D) SBI and Canara Bank. Show Answer Correct Answer: A) HDFC Bank & ICICI Bank. 20. Direct transfers is a Capital allocation process occur when a business sells its stocks or bonds directly to savers . A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 21. Governments issued bonds as know as what in the UK? A) Golden bond. B) Gilt. C) Gold edge bond. D) None of the above. Show Answer Correct Answer: B) Gilt. 22. Which financial market is known for trading options and futures contracts? A) Money Market. B) Forex Market. C) Derivatives Market. D) Commodity Market. Show Answer Correct Answer: C) Derivatives Market. 23. In financial markets, the period of maturity more than five years of financial instruments is classified as A) Short-term. B) Intermediate term. C) Capital term. D) Long-term. Show Answer Correct Answer: D) Long-term. 24. Which of the following is NOT an instrument of the money market? A) Company bonds. B) A bill of exchange. C) Treasury certificate. D) Treasury Bills. Show Answer Correct Answer: A) Company bonds. 25. The 'face value' of a share is also called: A) Discounted value. B) Issue price. C) Market value. D) Nominal value. Show Answer Correct Answer: D) Nominal value. 26. How does the financial system impact economic growth? A) The financial system impacts economic growth by efficiently allocating resources, enhancing liquidity, and promoting stability. B) The financial system has no effect on economic growth or stability. C) The financial system hinders economic growth by creating inefficiencies. D) The financial system only benefits large corporations and not the economy. Show Answer Correct Answer: A) The financial system impacts economic growth by efficiently allocating resources, enhancing liquidity, and promoting stability. 27. Shares actively traded in the stock market and are owned by a mix of public and private investors. A) Publicly. B) Privately. C) Widely. D) Closely. Show Answer Correct Answer: A) Publicly. 28. What are financial institutions? A) Financial institutions are companies that only offer loans to individuals. B) Financial institutions are non-profit organizations that provide free services. C) Financial institutions are organizations that provide financial services such as banking, investment, and insurance. D) Financial institutions are government agencies that regulate the economy. Show Answer Correct Answer: C) Financial institutions are organizations that provide financial services such as banking, investment, and insurance. 29. What does a discount broker provide? A) Access to exclusive investment opportunities. B) Comprehensive financial planning services. C) The basic services needed to buy and sell securities. D) Investment advice and portfolio management. Show Answer Correct Answer: C) The basic services needed to buy and sell securities. 30. Secondary markets are important because they: A) Decide IPO price bands. B) Provide liquidity & price discovery. C) Control inflation. D) Issue government bonds. Show Answer Correct Answer: B) Provide liquidity & price discovery. 31. Which financial market is known for trading long-term debt securities with maturities typically exceeding 10 years? A) Equity market. B) Bond market. C) Foreign exchange market. D) Money market. Show Answer Correct Answer: B) Bond market. 32. The SEC is a government agency that oversees FINRA A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 33. A firm should use ..... when evaluating an investment A) The least costly source of financing. B) The most costly source of financing. C) The weighted average cost of all financing sources. D) The current opportunity cost. Show Answer Correct Answer: C) The weighted average cost of all financing sources. 34. Trading procedure on a stock exchange. Which the correct order of steps below:-1.Placing an order2. Opening Demat Account3. Selecting a broker4.Settlement of transaction5. Executing the order A) 1, 3, 4, 2, 5. B) 3, 2, 1, 5, 4. C) 1, 2, 3, 5, 4. D) 2, 1, 3, 5, 4. Show Answer Correct Answer: B) 3, 2, 1, 5, 4. 35. A market where debt securities are issued and traded A) Capital Market. B) Equity Market. C) Bond Market. D) Money Market. Show Answer Correct Answer: C) Bond Market. 36. The capital market consists of A) Development banks. B) Commercial banks. C) Stock exchanges. D) All of the above. Show Answer Correct Answer: D) All of the above. 37. Which of the following is the method of collecting capital? A) Public Issue. B) Offer for Sale. C) Private Placement. D) All the above. Show Answer Correct Answer: D) All the above. 38. Financial markets promote economic efficiency by A) Reducing investment. B) Channeling funds from deficit Units to surplus units. C) Creating inflation. D) Channeling funds from surplus units to deficit units. E) Causing recessions. Show Answer Correct Answer: D) Channeling funds from surplus units to deficit units. 39. What is meant by the expression risk to reward as it pertains to trading? A) It is how much capital you are risking compared to how much you stand to gain. B) It is how much you are going to win on a trade when you trade forex. C) It refers to the way you enter a trade as a buy or sell. D) It specifically deals with a scalping strategy that you would use when you are in the markets during the accumulation phase. Show Answer Correct Answer: A) It is how much capital you are risking compared to how much you stand to gain. 40. What is fundamental analysis in security analysis? A) Fundamental analysis is a method of evaluating a security's intrinsic value by analyzing economic, financial, and other factors. B) Technical analysis focuses on price movements and trading volume. C) Sentiment analysis evaluates market psychology and investor emotions. D) Quantitative analysis uses mathematical models to assess stock performance. Show Answer Correct Answer: A) Fundamental analysis is a method of evaluating a security's intrinsic value by analyzing economic, financial, and other factors. 41. "Money Laundering" is the process of: A) Ensuring income is earned legally. B) Funneling "dirty" money through transactions to make it appear legitimate. C) Converting Crypto to US Currency. D) Verifying all taxes have been paid before distributing dividends. Show Answer Correct Answer: B) Funneling "dirty" money through transactions to make it appear legitimate. 42. How do financial markets influence economic growth? A) Financial markets have no impact on innovation. B) Financial markets only affect stock prices. C) Economic growth is solely determined by government policies. D) Financial markets influence economic growth by allocating resources efficiently, enabling investment, and facilitating innovation. Show Answer Correct Answer: D) Financial markets influence economic growth by allocating resources efficiently, enabling investment, and facilitating innovation. 43. Why should investment bankers understand all market types? A) To advise clients across funding, risk & growth options. B) To focus only on IPOs. C) To invest their own money. D) To avoid SEBI regulations. Show Answer Correct Answer: A) To advise clients across funding, risk & growth options. 44. BSE Sensex consists of how many companies? A) 30. B) 100. C) 50. D) 30. Show Answer Correct Answer: A) 30. 45. Formula of Intrest Covergae Ratio A) (Interest Expenses /Earning before interest & Taxes)*100. B) (Long term loans /Capital Employed)*100. C) (Earning before interest /interest expenses)*100. D) (Net Operating Income/Total Debt Service). Show Answer Correct Answer: C) (Earning before interest /interest expenses)*100. 46. Transactions in common stock occur in the money market, due to the large amount of money involved in such transactions. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: B) FALSE. 47. An example of the problem of ..... is when a corporation that uses the funds raised from selling new shares of stock to pay for Caribbean cruises for all of its employees and their families. A) Risk sharing. B) Prudential supervision. C) Moral hazard. D) Adverse selection. E) Credit risk. Show Answer Correct Answer: C) Moral hazard. 48. Which of the following is an example of a financial service? A) Manufacturing. B) Insurance. C) Agriculture. D) Retail. Show Answer Correct Answer: B) Insurance. 49. Which of the following is a key aspect of financial stability? A) Promoting economic growth. B) Increasing systemic risk. C) Limiting monetary policy support. D) Reducing consumer protection. Show Answer Correct Answer: A) Promoting economic growth. 50. An instrument used in the money market is: A) Treasury Bills. B) Development stocks. C) Shares. D) Government bonds. Show Answer Correct Answer: A) Treasury Bills. 51. Which would increase a firm's demand for a resource? A) An increase in the prices of complementary resources used by the firm. B) A decrease in the demand for the firm's product. C) An increase in the productivity of the resource. D) An increase in the price of the resource. Show Answer Correct Answer: C) An increase in the productivity of the resource. 52. At 8 % inflation, an item costing 100 today will cost A) 208. B) 108. C) 116.64. D) 118.84. Show Answer Correct Answer: B) 108. 53. The company made a bonus issue of 1 for 10. You held a total of 2, 000 shares of the company before the bonus issue was made. How many bonus shares were received by you. A) 20, 000 shares. B) 200 shares. C) 182 shares. D) 2, 200 shares. Show Answer Correct Answer: B) 200 shares. 54. What is the role of international banks in capital markets? A) To issue government bonds. B) To provide loans only to corporations. C) To gather excess cash and channel it to borrowers. D) To regulate interest rates. Show Answer Correct Answer: C) To gather excess cash and channel it to borrowers. 55. A function of the money market is: A) Funding large scale industrial projects only. B) Offering investment opportunities on a short-term basis. C) Facilitating the sale of company ownership. D) Provision of capital for permanent long-term investments. Show Answer Correct Answer: B) Offering investment opportunities on a short-term basis. 56. Direct exchange of goods/services for other goods/services is called: A) Haggling. B) Barter. C) Liquidity. D) Money. Show Answer Correct Answer: B) Barter. 57. First Indian Stock Exchange to offer fully automated Screen based system A) Bombay Stock exchange. B) Delhi Stock Exchange. C) National Stock exchange. D) None of the above. Show Answer Correct Answer: C) National Stock exchange. 58. National stock exchange of India situated at? A) Bangalore. B) Hyderabad. C) Bombay. D) None of these. Show Answer Correct Answer: C) Bombay. 59. What is the current total of the BoE's purchases of bonds via QE? A) £895bn. B) £435bn. C) £645bn. D) £990bn. Show Answer Correct Answer: A) £895bn. 60. To finance the building of a new police station, the government of the city of Richmond is MOST likely to issue a A) Municipal bond. B) Treasury bond. C) Junk bond. D) Money market bond. Show Answer Correct Answer: A) Municipal bond. ← PreviousNext →Related QuizzesCommerce QuizzesClass 12 QuizzesClass 12 Business Studies Chapter 10 Financial Markets Quiz 1Class 12 Business Studies Chapter 10 Financial Markets Quiz 2Class 12 Business Studies Chapter 10 Financial Markets Quiz 3Class 12 Business Studies Chapter 10 Financial Markets Quiz 4Class 12 Business Studies Chapter 10 Financial Markets Quiz 5Class 12 Business Studies Chapter 10 Financial Markets Quiz 6Class 12 Business Studies Chapter 10 Financial Markets Quiz 7Class 12 Business Studies Chapter 10 Financial Markets Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books