This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 10 Financial Markets – Quiz 24 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 10 Financial Markets Quiz 24 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the most liquid financial market in the world? A) Stocks and Commodities. B) Options Market. C) The Stock Market. D) The Forex Market. Show Answer Correct Answer: D) The Forex Market. 2. Metode Perdagangan OTC menggunakan sistem dimana harga bid dan ask diatur oleh ..... A) Market Makers. B) Partisipan Pasar. C) Algoritma Sistem. D) Broker. Show Answer Correct Answer: A) Market Makers. 3. Di bawah ini termasuk instrumen pembatasan mata uang, kecuali ..... A) Pembatasan jumlah. B) Tingkat suku bunga. C) Persetujuan pemerintah. D) Lisensi impor. Show Answer Correct Answer: B) Tingkat suku bunga. 4. Which product is most likely to have a higher fee: A) Passive fund. B) Direct mutual fund. C) Index fund. D) Regular mutual fund. Show Answer Correct Answer: D) Regular mutual fund. 5. Calculate the value 5 years hence of a deposit of Rs. 1, 000 made today if the interest rate is 8% (compounded annually). A) Not Attempted. B) Rs.1, 040. C) Rs.1, 469. D) Rs.1, 000. E) Rs.1, 400. Show Answer Correct Answer: C) Rs.1, 469. 6. In 1944, an international agreement among many countries, known as the ..... , called for fixed exchange rates between currencies. An exchange rate was set for each pair of currencies, and each country's central bank was required to maintain its respective local currency's value within 1 percent of the agreed-upon exchange rates. A) Bretton Woods Agreement. B) Breeton Whoods Agreement. C) Smithsanian Agreement. D) Smithsonian Agreement. Show Answer Correct Answer: A) Bretton Woods Agreement. 7. A series of meetings or presentations in which a company usually executives pitch an IPO to prospective investors A) Preliminaries. B) Reporting. C) Registration. D) Roadshow. Show Answer Correct Answer: D) Roadshow. 8. If a firm requires to two crores for six months time to keep the stock of raw material, it should approach A) Money market. B) Capital market. C) Both (a) and (b). D) None of the above. Show Answer Correct Answer: A) Money market. 9. Money Market deals with which type of funds? A) Long-term funds. B) Short-term funds. C) Medium-term funds. D) All types of funds. Show Answer Correct Answer: B) Short-term funds. 10. It is a short-term, negotiable, self-liquidating instrument which is used to finance the credit sales of firms. A) Commercial bill. B) Commercial papers. C) Call money. D) None of the above. Show Answer Correct Answer: A) Commercial bill. 11. What is the Australian Share Market called A) ASM. B) SXA. C) ASH. D) ASX. Show Answer Correct Answer: D) ASX. 12. What is the role of financial markets? A) To issue currency and maintain reserves. B) To stabilize the value of the Ringgit. C) To supervise the banking system. D) To transfer funds from surplus units to deficit units. Show Answer Correct Answer: D) To transfer funds from surplus units to deficit units. 13. Money market deals with ..... instruments. A) Long term. B) Medium term. C) Short term. D) All of the above. Show Answer Correct Answer: C) Short term. 14. What did the Federal Reserve Act of 1913 create and what was its purpose? A) The Federal Reserve System (The Fed) to serve as the central bank in the United States. B) The Federal Reserve Act of 1913 established the Federal Trade Commission. C) The Federal Reserve Act of 1913 created the Securities and Exchange Commission. D) The Federal Reserve Act of 1913 abolished the gold standard. Show Answer Correct Answer: A) The Federal Reserve System (The Fed) to serve as the central bank in the United States. 15. In Right Issue, shares are issued to A) General public. B) Existing shareholders. C) Institutes only. D) None of the above. Show Answer Correct Answer: B) Existing shareholders. 16. ..... is also called zero coupon bond. A) Trade bills. B) Call Money. C) Treasury bills. D) Commercial papers. Show Answer Correct Answer: C) Treasury bills. 17. When you keep deposit with a bank, you are A) Unitholder. B) Lender. C) Creditor. D) Debtor. Show Answer Correct Answer: C) Creditor. 18. What is crucially provided by central banks to help them achieve their objective of financial stability? A) Supply of workers. B) Worker insurance. C) Capital insurance. D) Liquidity insurance. Show Answer Correct Answer: D) Liquidity insurance. 19. Bonds are considered less risky than stocks because A) Bonds are issued by a national, state, or local government. B) Bondholders are paid before stockholders in the event a company fails. C) Corporations engaged in high-risk businesses are not allowed to issue bonds. D) The government regulates bonds more closely than it does stocks. Show Answer Correct Answer: B) Bondholders are paid before stockholders in the event a company fails. 20. Why is the DOW Jones Industrial Average important? A) It tells Americans how much debt the country is in. B) It helps economists predict when a stock market crash will happen. C) It provides a snapshot of how the stock market and the US economy are doing. D) None of the above. Show Answer Correct Answer: C) It provides a snapshot of how the stock market and the US economy are doing. 21. The BEST way to accumulate personal wealth is to A) Focus entirely on schoolwork and not worry about your "people" skills. B) Get as much education and job training as you can, and start saving money early in your life. C) Never do volunteer work or take an unpaid internship. D) Refuse to start at the bottom of a company in an entry-level job. Show Answer Correct Answer: B) Get as much education and job training as you can, and start saving money early in your life. 22. Bonds and shares are traded in A) Product markets. B) Capital markets. C) Money markets. D) Forex markets. Show Answer Correct Answer: B) Capital markets. 23. Why do higher interest rates attract foreign investment? A) They make investments riskier. B) They lower currency value. C) They offer better returns on investments. D) They increase inflation. Show Answer Correct Answer: C) They offer better returns on investments. 24. In the equation MV = PT, 'T' stands for: A) Total supply. B) Transaction demand. C) Taxation rate. D) Quantity of goods (or transactions). Show Answer Correct Answer: D) Quantity of goods (or transactions). 25. What allows people to invest at a lower cost than paying someone to do it for them? A) Mutual funds. B) Bonds. C) Index funds. D) Principal. Show Answer Correct Answer: C) Index funds. 26. A downtrend can best be described as ..... A) A series of lower lows and higher highs. B) A series of lower lows and lower highs. C) A long line of downward price movements. D) An old trend in trading. Show Answer Correct Answer: B) A series of lower lows and lower highs. 27. Which of the following is not the reason for acquisition? A) Increase market power. B) Overcoming entry barriers. C) Increase diversification. D) Building up brand image. Show Answer Correct Answer: D) Building up brand image. 28. Factoring services are mainly used by which type of firms? A) Large industries. B) Small and medium enterprises. C) Banks. D) Government agencies. Show Answer Correct Answer: B) Small and medium enterprises. 29. The process of holding securities in an electronic form is called ..... A) Dematerialisation. B) Rolling settlement. C) Depositry Participant. D) Beneficial Owner. Show Answer Correct Answer: A) Dematerialisation. 30. The Best Sell order is the order with the ..... A) Average Buy price. B) Not Attempted. C) Lowest Sell Price. D) Average Sell price. E) Highest Buy Price. Show Answer Correct Answer: C) Lowest Sell Price. 31. Non marketable assets are A) Government security. B) Bank deposit. C) Equity. D) Bearer debenture. Show Answer Correct Answer: B) Bank deposit. 32. Banks provide which of the following EXCEPT A) Check writing services. B) Debit cards. C) Loans. D) Government subsidies. Show Answer Correct Answer: D) Government subsidies. 33. Which market deals with existing securities? A) Primary. B) Capital. C) Secondary. D) Money. Show Answer Correct Answer: C) Secondary. 34. The Reserve Bank of India primarily regulates which of the following markets? A) Real Estate Market. B) Money Market. C) Stock Market. D) Commodity Market. Show Answer Correct Answer: B) Money Market. 35. The market price of a share is Rs. 120. Its book value is Rs. 20. The earnings of a share is Rs.11. The PE multiple of this share is A) 11. B) 10.9. C) 0.09. D) 6. Show Answer Correct Answer: B) 10.9. 36. ..... may antagonize customers and thus can be a very costly way of acquiring funds to meet an unexpected deposit outflow. A) Selling securities. B) Selling loans. C) Calling in loans. D) Selling negotiable CDs. Show Answer Correct Answer: C) Calling in loans. 37. Which of the following is included in the financial assets? A) Shares. B) Debentures. C) Treasury bill. D) All the above. Show Answer Correct Answer: D) All the above. 38. What is liquidity, and when is it an important consideration in savings? A) Liquidity refers to the ease of converting assets to cash; important for emergencies. B) Liquidity is the amount of savings; important for short-term goals. C) Liquidity is the value of investments; important for retirement. D) Liquidity is the interest rate on savings; important for long-term goals. Show Answer Correct Answer: A) Liquidity refers to the ease of converting assets to cash; important for emergencies. 39. What type of instruments are traded in a Money Market? A) Call money. B) Treasury bills. C) Commercial bills. D) All of the above. Show Answer Correct Answer: D) All of the above. 40. Savings bonds sell for less than their face value because A) Banks compete to sell them. B) They pay dividends twice a year. C) This is how they pay interest. D) Interest tax-exempt. Show Answer Correct Answer: C) This is how they pay interest. 41. As the costs associated with deposit outflows ..... , the banks willingness to hold excess reserves will ..... A) Decrease; not be affected. B) Increase; decrease. C) Increase; increase. D) Decrease; increase. Show Answer Correct Answer: C) Increase; increase. 42. Which of the following is a feature of term life insurance? A) Coverage for a specific period of time. B) Flexible premium payment options. C) Guaranteed cash value accumulation. D) Lifetime coverage without expiration. Show Answer Correct Answer: A) Coverage for a specific period of time. 43. What are these? NYSE-NASDAQ A) Stocks. B) Markets. C) Stock exhanges. D) Securities and exchanges. Show Answer Correct Answer: C) Stock exhanges. 44. Follows 500 stock prices to measure the health of the market A) NYSE. B) Dow Jones. C) S & P 500. D) NASDAQ. Show Answer Correct Answer: C) S & P 500. 45. ..... is defined as the annual rate of return on a bond if the bond were held to maturity. A) Yield. B) Dividend. C) Coupon rate. D) None of the above. Show Answer Correct Answer: A) Yield. 46. What kind of fund collects and invests income for later payments to eligible recipients? A) Insurance fund. B) Mutual fund. C) Pension fund. D) Credit union fund. Show Answer Correct Answer: C) Pension fund. 47. What is the primary appeal of the Eurocurrency market? A) Government-backed securities. B) High regulation. C) Low transaction costs due to lack of regulation. D) Guaranteed returns. Show Answer Correct Answer: C) Low transaction costs due to lack of regulation. 48. If a bank needs to raise the amount of capital relative to assets, a bank manager might choose to A) Buy back bank stock. B) Pay higher dividends. C) Reduce the bank's assets by making fewer loans. D) Sell securities the bank owns and put the funds into the reserve account. Show Answer Correct Answer: C) Reduce the bank's assets by making fewer loans. 49. How do banks help us with money? A) Banks only store money without any services. B) Banks charge fees for all transactions without providing loans. C) Banks help us by managing our deposits, providing loans, facilitating payments, and offering financial services. D) Banks only help businesses and not individuals. Show Answer Correct Answer: C) Banks help us by managing our deposits, providing loans, facilitating payments, and offering financial services. 50. Income not used for consumption A) Diversification. B) Investment. C) Savings. D) Return. Show Answer Correct Answer: C) Savings. 51. Forward markets for currencies of developing countries are: A) Less liquid than markets for currencies of developed countries. B) Prohibited. C) Only available for use by government agencies. D) More liquid than markets for currencies of developed countries. Show Answer Correct Answer: A) Less liquid than markets for currencies of developed countries. 52. The PRA and FCA are responsible for ..... A) Macro-prudential regulation. B) Micro-prudential regulation. C) All the above. D) None of the above. Show Answer Correct Answer: B) Micro-prudential regulation. 53. The benchmark stock market index of India is ..... A) Nikkei 225. B) S&P 500. C) Dow Jones. D) The NSE Nifty 50. E) Not Attempted. Show Answer Correct Answer: D) The NSE Nifty 50. 54. When Mr. McFall gets paid, he knows he doesn't have to spend it all at once because money is A) Standard of Value. B) Medium of Exchange. C) Store of Value. D) Fiat money. Show Answer Correct Answer: C) Store of Value. 55. The financial system includes the following ; A) Financial Institutions. B) Financial Markets. C) Financial Services. D) Financial Instruments. E) All of the above. Show Answer Correct Answer: E) All of the above. 56. Which of the following is a function of the stock exchange? A) Printing currency. B) Setting interest rates. C) Regulating commercial banks. D) Raising of long-term capital investment. Show Answer Correct Answer: D) Raising of long-term capital investment. 57. To ..... means to base decisions on an assessment of costs and benefits. A) Economize. B) Speculate. C) Day trade. D) Diversify. Show Answer Correct Answer: A) Economize. 58. In financial markets, financial instruments with maturity less than one year is classified as A) Intermediate term instruments. B) Short-term instruments. C) Capital term instruments. D) Long-term instruments. Show Answer Correct Answer: B) Short-term instruments. 59. What kind of finance involves financial intermediation? A) Public finance. B) Direct finance. C) Indirect finance. D) Private finance. Show Answer Correct Answer: C) Indirect finance. 60. The Bank Secrecy Act prevents: A) Criminals from using financial institutions to launder or hide money. B) Banks from charging illegally high interest rates to consumers. C) Financial Institutions from hiding profits to fool shareholders. D) All Answers are Correct. Show Answer Correct Answer: A) Criminals from using financial institutions to launder or hide money. ← 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