This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 10 Financial Markets – Quiz 25 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 10 Financial Markets Quiz 25 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Unorganized banking sector consist of A) LIC. B) RRB. C) Commercial bank. D) Indigenous bank. Show Answer Correct Answer: D) Indigenous bank. 2. Which agency regulates and supervises NBFCs? A) Respective state government. B) RBI. C) SEBI. D) Finance Ministry. Show Answer Correct Answer: B) RBI. 3. An agreement to buy or sell at a specific date in the future at a predetermined price A) Futures contract. B) Financial system. C) Bond. D) Capital market. E) Equities. Show Answer Correct Answer: A) Futures contract. 4. What are the characteristics of assets traded in capital markets? A) Assets that can only be traded in domestic markets. B) Assets with a maturity of greater than a year, including stocks and long-term bonds. C) Assets that include only physical commodities like gold and silver. D) Assets that are highly liquid and have a maturity of less than a year. Show Answer Correct Answer: B) Assets with a maturity of greater than a year, including stocks and long-term bonds. 5. What hours are the forex markets open? A) 12 noon-12 midnight. B) 8:00 A.M.-5:00 P.M. EST. C) Weekdays only. D) 24-hours a day except weekends. Show Answer Correct Answer: D) 24-hours a day except weekends. 6. Mencegah individu dan bisnis penduduk berinvestasi di negara lain dapat berdampak pada ..... A) Pertumbuhan ekonomi negara. B) Membayar utang kepada negara lain. C) Peningkatan neraca perdagangan. D) Mempertahankan persediaan mata uang asing. Show Answer Correct Answer: A) Pertumbuhan ekonomi negara. 7. If a trader wants to analyze a security's performance over the last year, which window would they use? A) Order/Trade Window. B) Snap Quote. C) Ticker Window. D) Inquiry Window. Show Answer Correct Answer: D) Inquiry Window. 8. How do financial markets facilitate capital allocation? A) Financial markets are solely for trading commodities and not for capital allocation. B) Financial markets restrict access to capital for small businesses. C) Financial markets connect investors with capital needs, enabling efficient allocation of resources. D) Financial markets only serve to increase government debt. Show Answer Correct Answer: C) Financial markets connect investors with capital needs, enabling efficient allocation of resources. 9. What are exchange-traded funds (ETFs)? A) Stocks that represent ownership in a single company. B) Bonds issued by governments that are traded on the stock market. C) Exchange-traded funds (ETFs) are investment funds traded on stock exchanges that hold a collection of assets. D) Mutual funds that can only be purchased directly from the fund company. Show Answer Correct Answer: C) Exchange-traded funds (ETFs) are investment funds traded on stock exchanges that hold a collection of assets. 10. Apa tujuan utama dari pembelian financial guarantees oleh penerbit sekuritas yang secara finansial lebih lemah? A) Untuk menurunkan risiko obligasi mereka. B) Untuk meningkatkan bunga obligasi. C) Untuk mempercepat pembayaran obligasi. D) Untuk mengurangi jumlah investor. Show Answer Correct Answer: A) Untuk menurunkan risiko obligasi mereka. 11. It is used as an alternative to bank borrowing for large and creditworthy companies, A) Commercial bill. B) Commercial papers. C) Call money. D) None of the above. Show Answer Correct Answer: B) Commercial papers. 12. Aside from M3 which of the following is included in the definition of broad money? A) Deposits with the RBA. B) Deposits held in foreign banks by Australian companies. C) Currency including notes and coins. D) Borrowings by all financial intermediaries from the private sector. Show Answer Correct Answer: D) Borrowings by all financial intermediaries from the private sector. 13. Which of the following are long-term financial instruments? A) A negotiable certificate of deposit. B) A treasury bill. C) A treasury bond. D) A banker's acceptance. Show Answer Correct Answer: C) A treasury bond. 14. Which one of the following is responsible for issuing bank notes? A) Central bank. B) Commercial bank. C) Building societies. D) Insurance companies. Show Answer Correct Answer: A) Central bank. 15. Why, in particular, is liquidity insurance necessary? A) Banks borrow short term but lend long term. B) Banks are not good at their job. C) Banks borrow long term but lend short term. D) Banks never make a profit from lending. Show Answer Correct Answer: A) Banks borrow short term but lend long term. 16. Which role do commercial banks primarily serve? A) Conducting market research. B) Connecting savers and borrowers. C) Facilitating capital raising. D) Providing insurance products. Show Answer Correct Answer: B) Connecting savers and borrowers. 17. Which of the following is an instrument used in the capital market? A) Bill of exchange. B) Treasury certificate. C) Treasury Bills. D) Shares. Show Answer Correct Answer: D) Shares. 18. Which one of the following types of securities has no priority in a bankruptcy proceeding? A) Senior debt. B) Convertible bond. C) Common stock. D) Preferred stock. E) Straight bond. Show Answer Correct Answer: C) Common stock. 19. Which of the following is the regulator of the credit rating agencies in India? A) R B I. B) The S B I. C) S I D B I. D) The S E B I. E) None of these. Show Answer Correct Answer: D) The S E B I. 20. All the following companies can be categorized as having a high operating leverage EXCEPT: A) Asset Management Companies. B) Brokerage Firms. C) Registrar and Transfer Agents. D) FMCG. Show Answer Correct Answer: D) FMCG. 21. ..... market is a market for short term fund A) Money market. B) Capital market. C) Cash market. D) Commodity market. Show Answer Correct Answer: A) Money market. 22. Which of the following is an asset? A) Share Capital. B) Long Term Borrowing. C) Retained profit. D) Advances. Show Answer Correct Answer: D) Advances. 23. How can an investor acquire equity shares? A) Secondary Market only. B) Money Market. C) Through the Primary Market or Secondary Market. D) Primary Market only. E) Not Attempted. Show Answer Correct Answer: C) Through the Primary Market or Secondary Market. 24. What is it called with the market is rising for months and people are buying/selling stocks? A) Bear market. B) Hippo market. C) Rabbit market. D) Bull market. Show Answer Correct Answer: D) Bull market. 25. ..... value is the historical cost less accumulated depreciation A) Book value. B) Face Value. C) Market Value. D) None of the above. Show Answer Correct Answer: A) Book value. 26. Which organization regulates mutual funds in India? A) IRDAI. B) RBI. C) NABARD. D) SEBI. Show Answer Correct Answer: D) SEBI. 27. What is the regulatory framework governing financial services in India? A) It includes the Ministry of Finance and the Securities Act. B) The framework consists of RBI, SEBI, and the Income Tax Act. C) The regulatory bodies are RBI, SEBI, and the Consumer Protection Act. D) The regulatory framework includes RBI, SEBI, IRDAI, PFRDA, and relevant laws like the Companies Act and Banking Regulation Act. Show Answer Correct Answer: D) The regulatory framework includes RBI, SEBI, IRDAI, PFRDA, and relevant laws like the Companies Act and Banking Regulation Act. 28. During periods of inflation, money does not function well as ..... A) Standard of Value. B) Medium of Exchange. C) Store of Value. D) Commodity money. Show Answer Correct Answer: C) Store of Value. 29. Who are the participants in the Securities Market? A) Investor. B) Intermediaries, such as merchant bankers, brokers etc. C) Issuers, i.e. companies who issue shares. D) All of the above. E) Not Attempted. Show Answer Correct Answer: D) All of the above. 30. Which of the following best describes the concept of arbitrage in financial markets? A) Buying and holding assets for long-term gains. B) Simultaneously buying and selling an asset in different markets to profit from price differences. C) Selling securities short to capitalize on expected price declines. D) Investing in securities for tax benefits. Show Answer Correct Answer: B) Simultaneously buying and selling an asset in different markets to profit from price differences. 31. The followings are correct regarding characteristics of money market securities EXCEPT A) Low degree of risk. B) High expected return. C) Liquid. D) Low expected return. Show Answer Correct Answer: B) High expected return. 32. What is the BoE's stated remit? A) To increase the money supply. B) To increase the stability of the £. C) To increase exports. D) To deliver price stability and, subject to this, to support the government's economic objectives including those for growth and employment. Show Answer Correct Answer: D) To deliver price stability and, subject to this, to support the government's economic objectives including those for growth and employment. 33. Sensex comprises of ..... stocks A) 50. B) 30. C) 60. D) 40. Show Answer Correct Answer: B) 30. 34. The technique of spreading funds over a large number of investments to reduce the portfolio's overall risk is known as A) Bear markets. B) Mutual funds. C) Pension plans. D) Diversification. Show Answer Correct Answer: D) Diversification. 35. Which of the following is a characteristic of a bond? A) It represents ownership in a company. B) It typically pays interest over time. C) It has no maturity date. D) It is always risk-free. Show Answer Correct Answer: B) It typically pays interest over time. 36. Junk bonds usually have low ratings because ..... A) They have a low risk of default. B) They are a high-risk investment. C) They have a low rate of return. D) They are not risky investments. Show Answer Correct Answer: B) They are a high-risk investment. 37. When you deposit $ 50 in currency at Old National Bank A) Its liabilities decrease by $ 50. B) Its liabilities increase by $ 50. C) Its reserves increase by less than $ 50 because of reserve requirements. D) Its assets increase by less than $ 50 because of reserve requirements. Show Answer Correct Answer: B) Its liabilities increase by $ 50. 38. The best rating a bond can receive A) D. B) AAA. C) AA. D) B. Show Answer Correct Answer: B) AAA. 39. A customer buys 100 shares of TCS @ Rs. 2408 per share and sells all of them back the same day at Rs. 2512. How does he settle trades for the day? A) He shall receive Rs.10, 400 from the stock exchange. B) He shall pay Rs.10, 400 to the stock exchange. C) He shall pay Rs. 240, 800 to the stock exchange. D) He shall receive Rs.251, 200 from the stock exchange. Show Answer Correct Answer: A) He shall receive Rs.10, 400 from the stock exchange. 40. It is the number assigned to each transaction by the Stock Exchange and is printed on the contract note. A) PAN number. B) Unique order code. C) Contract note. D) None of the above. Show Answer Correct Answer: B) Unique order code. 41. In free cash flow valuation, depreciation is added back because it is: A) An investment expenditure. B) A tax payment. C) A cash inflow. D) A non-cash accounting expense. Show Answer Correct Answer: D) A non-cash accounting expense. 42. After the trade has been executed, the broker issues a Contract Note to the investor within A) 48 hours. B) 24 hours. C) 12 hours. D) 52 hours. Show Answer Correct Answer: B) 24 hours. 43. Which of the following is required to invest in stock markets? A) Adhar Card. B) D-mat account. C) Saving account. D) PAN card. Show Answer Correct Answer: B) D-mat account. 44. Which of the following is a derivative security? A) Common stock. B) Treasury bond. C) Call option. D) Municipal bond. Show Answer Correct Answer: C) Call option. 45. If the quantity of money (M) increases, and V and T remain constant, then: A) P will increase. B) P will decrease. C) V will decrease. D) P will remain constant. Show Answer Correct Answer: A) P will increase. 46. The Second-Tier Securities Market was established in: A) 1990. B) 2000. C) April 1985. D) 1960. Show Answer Correct Answer: C) April 1985. 47. What is the primary benefit of investing in index funds? A) They guarantee high returns. B) They provide diversification at a low cost. C) They are risk-free investments. D) They are actively managed by professionals. Show Answer Correct Answer: B) They provide diversification at a low cost. 48. These are companies have a market cap between $ 300 million to $ 2 billion. A) Micro-cap. B) Nano-cap. C) Small-cap. D) Mid-cap. Show Answer Correct Answer: C) Small-cap. 49. What is the London Interbank Offer Rate (LIBOR)? A) The rate banks charge each other for loans. B) The interest rate for government bonds. C) The rate for personal loans. D) The rate for currency exchange. Show Answer Correct Answer: A) The rate banks charge each other for loans. 50. What is a common type of life insurance policy? A) Term life insurance. B) Whole life insurance. C) Variable life insurance. D) Universal life insurance. Show Answer Correct Answer: A) Term life insurance. 51. What are the Dow Jones and S&P 500? A) Averages of stocks & bonds that are traded often. B) Indexes that track the sales of all real estate transactions within the U.S. C) Indexes that show the performance of limited but representative stocks. D) Cumulative records of all stocks sold on the NYSE & other major exchanges. Show Answer Correct Answer: C) Indexes that show the performance of limited but representative stocks. 52. Market for selling financial assets that can only be redeemed by the original holder. A) Primary market. B) Secondary market. C) All the above. D) None of the above. Show Answer Correct Answer: A) Primary market. 53. An important financial institution that assists in the initial sale of securities in the primary market is? A) Commercial bank. B) Brokerage house. C) Stock exchange. D) Investment bank. Show Answer Correct Answer: D) Investment bank. 54. Tujuan pasar modal internasional adalah, kecuali ..... A) Menambah relasi dengan pengusaha. B) Mengurangi biaya uang untuk peminjam. C) Memperluas penyediaan uang bagi peminjam. D) Mengurangi resiko bagi pemberi pinjaman. Show Answer Correct Answer: A) Menambah relasi dengan pengusaha. 55. Mengapa saham dianggap lebih berisiko dibandingkan obligasi? A) Karena dividen tidak selalu pasti dan kenaikan harga saham tidak dijamin. B) Karena saham tidak bisa dijual. C) Karena saham selalu memberikan dividen. D) Karena pemegang saham memiliki prioritas lebih tinggi dari pemegang obligasi. Show Answer Correct Answer: A) Karena dividen tidak selalu pasti dan kenaikan harga saham tidak dijamin. 56. For calculating book value:what is considered? A) Only tangible assets. B) Tangible + intangible assets. C) Tangible assets+ future value of these assets. D) None of the above. Show Answer Correct Answer: A) Only tangible assets. 57. Capital appreciation refers to A) The increased value of an asset. B) The decreased value of an asset. C) All the above. D) None of the above. Show Answer Correct Answer: A) The increased value of an asset. 58. COMPUTATION:The bond has a face value of 500, 000 with an interest of 50, 000. The prevailing value of the bond in the market is 700, 000. How much is the rate of capital gain or return? A) 10%. B) 50%. C) 40%. D) 30%. Show Answer Correct Answer: B) 50%. 59. What does FDI stand for in financial markets? A) Foreign Direct Investment. B) Financial Debt Investment. C) Foreign Depository Investment. D) Federal Development Investment. Show Answer Correct Answer: A) Foreign Direct Investment. 60. ..... is defined as an action taken today that will create benefits in the future. A) Diversification. B) Yield. C) Investment. D) None of the above. Show Answer Correct Answer: C) Investment. ← 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