1. A brokerage or analyst report will contain all of the following except? a. Detailed description of the company, and its industry. b. Opinion on why the analyst believes the company will succeed or fail. -c. Recommendations to buy, sell, or hold the company. d. Target price or performance prediction for the stock in a year. e. Track record of the analyst writing the report. 2. 2 Marks One should have the MMDA(Money Market Deposit Account) if one is looking for _______________________. a. Quick, convenient and, frequent-access to the money -b. A high rate of interest c. Guaranteed rate of interest d. Low fee e. None of the listed Options 3. 2 Marks ______________ for securities lending, which bring lenders and borrowers together, may eliminate _______________. a. Wholesale intermediaries; Niche intermediaries -b. Internet auction systems; custodian and third party intermediaries c. Custodian and third party intermediaries: Niche intermediaries d. Niche intermediaries; custodian and third party intermediaries e. Internet auction systems; Niche intermediaries 4. 2 Marks Money laundering can best be described as the process by which ____________________________________________. -a. money gained from criminal activity is processed so it appears to be gained from legitimate sources b. criminals attempt to defraud the government c. money gained from legitimate sources is hidden to avoid taxes d. the police attempt to investigate organized crime e. None of the listed Options 5. 3 MarksA U.S. importer who has agreed to pay 1 million Euros to a French exporter in 60 days decides to wait the full 60 days before paying. The importer is ______________________. -a. a foreign exchange speculator b. expecting the dollar to depreciate against the Euro c. a hedger in the foreign exchange market d. planning to pay a set amount of dollars for the items purchase e. None of the listed Options
Transcript
1. A brokerage or analyst report will contain all of the following except?a. Detailed description of the company, and its industry. b. Opinion on why the analyst believes the company will succeed or fail. -c. Recommendations to buy, sell, or hold the company.d. Target price or performance prediction for the stock in a year. e. Track record of the analyst writing the report.
2. 2 MarksOne should have the MMDA(Money Market Deposit Account) if one is looking for _______________________.a. Quick, convenient and, frequent-access to the money-b. A high rate of interestc. Guaranteed rate of interestd. Low feee. None of the listed Options
3. 2 Marks ______________ for securities lending, which bring lenders and borrowers together, may eliminate _______________.a. Wholesale intermediaries; Niche intermediaries-b. Internet auction systems; custodian and third party intermediariesc. Custodian and third party intermediaries: Niche intermediariesd. Niche intermediaries; custodian and third party intermediariese. Internet auction systems; Niche intermediaries
4. 2 Marks Money laundering can best be described as the process by which ____________________________________________.-a. money gained from criminal activity is processed so it appears to be gained from legitimate sourcesb. criminals attempt to defraud the governmentc. money gained from legitimate sources is hidden to avoid taxesd. the police attempt to investigate organized crimee. None of the listed Options
5. 3 MarksA U.S. importer who has agreed to pay 1 million Euros to a French exporter in 60 days decides to wait the full 60 days before paying. The importer is ______________________.-a. a foreign exchange speculatorb. expecting the dollar to depreciate against the Euroc. a hedger in the foreign exchange marketd. planning to pay a set amount of dollars for the items purchasee. None of the listed Options
6. 1 MarksThe term POP stands for?a. Private Offer Priceb. Private Option Price-c. Public Offer Priced. Public Option Pricee. Potential Offer Price
7. 1 Marks
Continuous Linked Settlement removes which of the following risks primarilya. Exchange risk-b. Temporal riskc. Country riskd. All of the listed optionse. None of the listed Options
8. 2 MarksWhich of the following is correct with reference to Indian banks?a. Indian banks are unregulatedb. Saraswat Bank is the largest Indian bank -c. Reserve Bank of India regulates the Indian banksd. Indian banks cannot open branches outside of Indiae. India's banking system is one of the weakest in the world
9. 1 MarksEFT stands for _______________.a. Express Funds Transferb. Electrical Funds Transferc. Elevated Funds Transferd. Emergency Funds Transfer-e. Electronic Funds Transfer.10. 1 MarksBanks are financial intermediaries that ____________________.-a. link lenders (depositors) to borrowers b. have been in existence now for over 50000 yearsc. are not requiredd. cause problems as their sales reps keep calling people to buy new productse. should not be allowed to open Savings Accounts
11Which of the following is not a type of Swap?Answer:a. Currency Swap' b. Forward Swapc. Swaption-d. Interest Rate 12 Forfeiture regulation under the US patriot act allows _____________________________ Answer: -a. permits confiscation of any property derived from or used to facilitate domestic or international terrorism b. Calls for the seizure of correspondent accounts held in foreign financial institutions for domestic banks who are in turn holding forfeitable assetsc. Permits foreign enforcement of domestic forfeiture ordersd. All of the listed optionse. None of the listed Options
13.Annual Percentage Rate for a loan takes into account the following?
Answer:a. The interest rate chargedb. When and how often the interest must be paidc. Other charges such as arrangement feed. When and how often these other charges must be paid-e. All of the listed options
14.A young investor comes to an Investment Consultant and asks him for advice for his investments. He declares that he doesn’t mind the risk but he would definitely like his money to grow as fast as possible. He would like to invest in a Mutual Fund which would satisfy these criteria. What would the consultants choice for his profile?
Answer:a. Income Fundb. Liquid Fund-c. Growth Fundd. Balanced Funde. Bank Deposit
15ABC corporation is a large client of BankNew and maintains $40 million in cash with the bank. BankNew however allows authorized representatives off ABC to write checks up to 10% over the balance maintained. This is an example of ____________________________________.Answer:-a. Overdraft b. Accrual Loanc. Held for Sale Loansd. Undrawn Loane. Committed Loans
16. Which of the following is associated with the purpose of regulating financial institutions?a. To ensure everyone makes money in the marketb. To ensure companies can cheat small investors in buying their securities-c. To prevent failure of any financial institution d. To ensure that various government departments can be created for regulation thus giving employment to many peoplee. All of the listed options
17. Which of the following is true about Retail Banking business?Answer:a. The business focuses on small number of high net worth individuals-b. The business focuses on large number of individuals each of whom may have a small amount of money to deposit with the Bankc. The business focuses on large corporate bodiesd. The business focuses on small and medium enterprisese. The business focuses on giving financial advice to customers to generate maximum returns on their investments
18.What is the best basis for the comparison of dividend paying stocks with other investments such as bonds, certificates of deposits etc?Answer:a. Interest spreadb. Exchange rate-c. Interest rated. Equity yielde. Dividend yield
19. Corporate Loans are ___________________________________Answer:a. always secured-b. secured or unsecured
c. never securedd. always unsecurede. None of the listed Options
20. Services like the settlement, safekeeping, and reporting of customers’ marketable securities and cash are provided by _________________.
Answer:-a. Custodianb. Brokerc. Investment bankd. Fund Administratore. Dealer
21. CRR stands for which of the following?Answer:-a. Cash Reserve Ratiob. Common Reserve Ratioc. Cash Refund Ratiod. Cash Re-service Ratioe. Cash Reserve Risk
23.1 MarksWhich of the following is not a risk management measure?Answer:a. Diversificationb. Hedgingc. Insurance-d. Budgetinge. All are risk management techniques
24 2 MarksThe quote for CTSH in NASDAQ was $ 43. The best buyer was at $ 42.5 and the best seller at $ 43.5.</p><p> How much is the bid-ask spread?
25 1 MarksThe easiest way to calculate IRR (Internal Rate of Return) is________________________________________________.Answer:
a. writing a Java program with 100 FPs-b. using MS-Excelc. using a supercomputerd. using a 2GHz processore. writing JCLs running on a powerful Mainframe
26 3 MarksYou invest Rs.5000 at 10% p.a. compound interest compounded annually in a bank. After 2 years, what is the amount you have received from the bank?Answer:a. Rs. 12346b. Rs. 7000c. Rs. 2346-d. Rs. 6050e. Rs. 7546
27 1 Marks
The central bank in the US is called ________________.Answer:-a. Federal Reserveb. Federal Reserve Boardc. Reserve Bank of United Statesd. Central Bank of United Statese. Reserve Bank of America
28 ABC corporation is a large client of BankNew. BankNew extends a loan to XYZ corporation which is a supplier of ABC. This is an example of _______________________.Answer:a. Bill Discounting-b. Supplier Loanc. Asset Securitization Loand. Working Capital Loane. Revolving Line of Credit
29 2 MarksThe act of a loan amount being handed over to the borrower by the Bank is know as?
Momentum investing” would refer to ___________________________.Answer:a. follow fundamental financial ratios to make decisionsb. invest in high dividend yield stocksc. following charts and indicators to traded. create portfolio similar to index-e. try best to market
31 3 Marks
Private clients trade in ____________ volumes and ___________ fees and commissions.Answer:-a. larger; largerb. small; largerc. small; smalld. larger; smalle. Either small; larger or larger; small
32 1 MarksBid-Ask spread refer to ________________________________.Answer:a. difference in price between buying one asset and another similar oneb. difference in opinion between the seller and buyer on the price of an asset-c. difference between the buying and selling price of the same assetd. both difference in price between buying one asset and another similar one and difference in opinion between the seller and buyer on the price of an assete. None of the listed Options
33 1 MarksThe process in which a privately held company offers its shares to public for the first time is known as?a. Public Offeringb. Corporate Actionc. Underwriting-d. Initial Public Offeringe. None of the listed Options
34 3 MarksNot all possible services that might be provided by the auditing firm are expressly prohibited by Sarbanes-Oxley. If a non-audit service is not expressly prohibited, the auditing firm may provide that service ___________________________Answer:a. If no one on the board objects.-b. If the audit committee gives its prior approval.c. Only in an emergency and only if the company being audited has not been able to find another accounting firm to provide this service after making a good-faith effort.d. Without any prohibitions or pre-conditions whatsoever.e. None of the listed Options.
35 1 MarksThe performance of an internationally diversified portfolio may be affected by ________________________.Answer:a. currency selectionb. country selectionc. stock selection-d. All of the listed optionse. None of the listed Options
36 1 MarksPrimary markets ____________________Answer:a. are markets in which primary goods and service, i.e. raw materials are traded.
b. are markets in which short-term debt is traded.c. are markets in which claims that have already been issued are sold by one investor to another.-d. are markets in which newly issued claims are sold to initial buyers.e. are markets in which shares are actively traded.
37 3 MarksWhat does the ‘Federal Reserve Supervisory Letter’ define private banking as?Answer:-a. “personalized services such as money management, financial advice, and investment services for high net worth clients”b. “personalized services such as cheque collection and other retail banking services for high net worth clients”c. “service provided by private banks to all clients”d. “personalized services provided by private and public banks to all clients”e. None of the listed Options
38 1 MarksThe term PTA refers to ______________________.Answer:a. Permission to Actb. Payable Through Automated Meansc. Payment To Automate-d. Payable Through Accounte. None of the listed Options
39 1 MarksThe city of Basel is located in which country?Answer:a. USAb. Indiac. Japand. UK-e. Switzerland
40 1 MarksInflation represents which of the following?Answer:-a. Increase in pricesb. Decrease in pricesc. Very high change in pricesd. Economic crisise. Currency crisis
41 1 MarksFinancial intermediaries exist because small investors cannot efficiently ________________________.Answer:a. gather information b. advertise for needed investments c. monitor their portfolios d. diversify their portfolios -e. All of the listed options
42 1 Marks
Which is not a banking account?Answer:a. Checking Accountsb. Money Market Deposit Accounts-c. Demat Accountd. Time Depositse. None of the listed Options
43 1 MarksPick the odd one out.Answer:a. Warren Buffetb. Peter Lynchc. George Soros-d. Sachin Tendulkare. Rakesh Jhunjhunwala
44 1 MarksIn a economy where inflation is 5%, future value of 100 units of money after 1 year would be which of the following?a. More than 100-b. Less than 100c. Exactly 100d. 105, as inflation is 5%e. None of the listed Options
45 2 Marks What term is used to describe an LC that remains valid for years thereby eliminating the cost of separate LCs for each transaction with a regular client?Answer:-a. Evergreen Clauseb. Red Clausec. Irrevocable LCd. Transferable LCe. None of the listed Options
46 2 MarksWhen the Central Bank of a country decides to change the interest rates, it is a manifestation of which of the following?Answer:a. Money Policyb. Money Marketc. Money Multiplier Effect-d. Monetary Policye. Money making
47 3 MarksWhich of the following is not a rating agency?Answer:a. S&P-b. Reserve Bank of Indiac. Moody'sd. Fitche. Crisil
48 2 MarksWhen you deposit $200 in currency into your bank _________________Answer:a. its assets decline by $200.b. its reserves decline by $200.-c. its liabilities increase by $200.d. each of the above occur.e. its assets decline by $200 and its reserves decline by $200.
49 1 MarksTrade Finance helps in ________________________________.Answer:-a. Facilitating International transactionsb. Facilitating intra-compamy transactionsc. Facilitating corpoate lendingd. Facilitating setting up of new factoriese. Facilitating International transactions,Facilitating corpoate lending and Facilitating setting up of new factories
50 2 MarksBank of America charges a lower rate of interest to Lockheed Martin than to General Electric. This can be attributed to lower ________ risk from Lockheed as compared to GE for Bank of America.Answer:a. Market Risk-b. Credit Riskc. Liquidity Riskd. Legal Riske. None of the listed Options
51 1 Marks "Don't put all your eggs in one basket" is a phrase used to describe which of the following?a. risk averse -b. diversificationc. risk/return tradeoffd. time value of moneye. budgeting
52 1 MarksPick the odd one out.Answer:a. Visab. Mastercardc. Amexd. Discover-e. HSBC Bank
53 1 MarksWhich of the following is not likely to be an electronic banking function?Answer:a. Direct Debitb. Standing Orderc. Standing Instruction-d. Account opening
e. Wire transfer
54 1 MarksWhich division provides services to High Net Worth individuals?Answer:a. Corporate bankingb. Investment bankingc. Retail banking-d. Private bankinge. None of the listed Options
55 1 MarksWhich term refers to securities that are sold by the issuer to investors?Answer:a. Secondary Offeringb. Outright Sale-c. Primary Offeringd. Select Salee. None of the listed Options
56 2 MarksA bank that is earning 7% on its earning assets and is paying 4% on its interest-earning liabilities is said to __________________Answer:a. have a negative spread.b. have a positive GAP position. -c. have a positive spread.d. will always have positive net earnings.e. both have a negative spread and will always have positive net earnings.
57 1 Marks
Due Diligence is performed to ____________________________________.Answer:-a. assess the risk b. performed by the buyerc. performed on the sellerd. executed after contract is signede. All of the listed options
58 1 Marks______________ preauthorizes banks to pay recurring bills like insurance premium, utility bills automatically.a. Pay-by-Phone Systemb. EFT-c. Direct Debitd. Direct Credite. Direct Deposit
59 1 Marks
BankNew has a portfolio of $30 million worth of loans, which it wants to hedge. This is an example of what kind of drawn loans?Answer:a. Accrual Loans
b. Trading Loans-c. Held for Sale Loansd. Undrawn Loane. Committed Loans
60 3 MarksRegulatory balance sheet restrictions are designed to _________________Answer:a. limit the size of depository institutions. b. limit risk-taking and to encourage diversification. c. limit excessive diversification.d. to promote Universal Banking.e. encourage high risk-taking by proper diversification.
61 3 MarksCapital adequacy ratio refers to ___________________________.Answer:a. Amount of bank’s capital expressed as percentage of the risk weighted credit exposureb. Amount of bank’s capital expressed as percentage of the risk weighted credit exposure & operational risk c. Amount of bank’s capital expressed as percentage of the risk weighted credit exposure, & market risk d. Amount of bank’s capital expressed as percentage of the risk weighted credit exposure, operational risk & market riske. None of the listed Options
62 The term CP is used in Corporate Lending for ___________________________.Answer:a. Client Partnerb. Credit Provision-c. Commercial Paperd. Collateral Provisione. Commodity Put Option
63 1 Marks“Dealer” in broking parlance refers to which one of the following?Answer:a. Employee of stock exchange b. Matches customer orders with other brokers-c. Acts as a “Principal” and executes trades for his/her personal accountd. Only person authorized to buy or sell a particular stocke. Charges commission for trades
64 1 MarksPick the odd one out with respect to Private Banking services.Answer:a. Switzerlandb. Luxembourgc. Caymen Islands-d. Mumbaie. Mauritius
65 Why do we need banks?Answer:
a. Banks are in the best position to lend out money at competitive rates to businesses and individualsb. Deposits are participants in primary and secondary marketsc. Banks are in the best position to lend out money at competitive rates to businesses and individualsd. Small investors are protected, hence it is a low risk investment avenue-e. All of the listed options
66 The key feature of letter of credit is ________________________________________.Answer:a. basis for devising proper currency hedging strategy-b. distributes risk between buyer and sellerc. opportunity to receive payment in advance of the due dated. basis for devising proper currency hedging strategy and Opportunity to receive payment in advance of the due datee. All of the listed options
67 Which of the following is not a function of a Custodian?Answer:a. Core Custodyb. Asset Servicing-c. Corporate Lendingd. Securities Lendinge. Corporate Actions68 1 MarksThe treasury services department performs all of the following functions EXCEPT ___________________________.Answer:a. Research market factors e.g., Interest rate monitoringb. Managing corporate collections and paymentsc. Managing liquidity and cash positiond. Risk Management services-e. None of the listed Options
69 1 MarksWhich of the following is not covered under retail operations of a Bank?Answer:a. Loan for Consumer durablesb. Hire Purchase-c. Bill Discountingd. Lease e. Auto Loans
70 IRR stands for which of the following?Answer:a. International Rate of Malaysian Ringitb. International Rating of Rwanda-c. Internal Rate of Returnd. Indian Rate of Returne. International Rate of Return
71 3 MarksInter District Settlement Fund is a _____________.Answer:-a. Fund Transfer System
b. Electronic Bill Presentment Systemc. Settlement Accountd. Booking Systeme. Transaction System
72 Following are the list of risks that Cognizant faces at an organization level EXCEPT ______________________________________.Answer:a. Exchange rate fluctuationb. Protective legislation by U.S/U.Kc. Attritiond. Payment defaulte. Cognizant faces all of the risks mentioned in the listed options
73 1 MarksWhich of the following is not a Retail Banking service?Answer:a. Current accountsb. Savings accountsc. Cheque book facility-d. Investment advicee. ATM facility
74 Warrants are the combination of which of these instruments?Answer:-a. Equities and Call Optionsb. Call and Put Optionsc. Equities and Futuresd. Cash and Call Optionse. Put Options and Swaps
75 1 MarksCore Custody Services performs the following functions except ________________________.Answer:a. Price securities positionsb. Record Keeping-c. NAV calculationd. Reporting servicese. Processes corporate actions
76 What is the key regulatory authority over the American securities industry?Answer:a. Federal Reserveb. FDICc. DTCCd. ASA-e. Securities Exchange Commission
77 After a buyer and a seller enter into a trade agreement, who initiates the issue of LC?Answer:a. Sellerb. Seller's bankc. Buyer's bankd. Buyere. None of the listed Options
78 Which of the following is a foreign bank not operating in India as a retail bank?Answer:a. Citibankb. HSBC-c. JP Morgan Chased. Standard Charterede. ABN Amro
79 Legal risk is the __________________________________________.Answer:a. possibility that you will face legal actionb. loss you could incur when legal action is taken against you-c. possibility of loss when a contract cannot be enforced d. possibility of loss from errors in instructing payments or settling transactionse. None of the listed Options
80 The term EMI stands for which of the following?Answer:a. Equal Monthly Incomeb. Equalised Monetary Installmentsc. Equated Money Inflowd. European Monetary Inflows-e. Equated Monthly Installments
81 Which of the following are involved in the mortgage business in US?Answer:a. Ginnie Maeb. Fannie Mae-c. Both Ginnie Mae and Fannie Maed. Sallie Maee. Federal Reserve
82 In Banking , the term LIBOR stands for?Answer:a. Limited Borrowingb. Limited International Banking Operations-c. London Interbank Offered Rated. Lending to International Borrowerse. None of the listed Options
83 Loss of which of the following type of cards can cause the maximum financial impact for the customer?a. Debit Cardb. ATM Cardc. Stored Cardd. Gift Vouchere. Any of the listed options
84 Individual investors are most likely to trade securities in ________________________.Answer:a. Forex marketb. Money Market-c. Stock Marketd. Mortgage Market
e. New York
85 A share represents __________________.Answer:a. ownership in a companyb. right to vote in important matters of the companyc. an instrument whose value might appreciate in secondary marketd. an instrument which can potentially earn dividends-e. All of the listed options
86 Cash management techniques include ____________________________________.Answer:a. Poolingb. Nettingc. Swapping-d. Both Pooling and Nettinge. Pooling, Netting and Swapping
87 A very effective way to employ a passive strategy is to _____________________________.Answer:a. invest in an indexed portfoliob. buy all Stocks on the indexc. invest money in a bank-d. buy few securities which reflect the indexe. both invest money in a bank and buy few securities which reflect the index
88 In context of Treasury services, FRA stands for which of the following?Answer:a. Frivolous Rate Agreement-b. Forward Rate Agreementc. Free Rate Agreementd. Factored Rate Agreemente. Forfeited Rate Agreement89 Which of the following is not associated with debt?Answer:a. Coroprate Bondsb. Debentures-c. Sharesd. Loanse. Government Bonds
90 Electronic banking doesn’t covers the following services.Answer:a. Pay-by Phone systemb. ATM Systemc. Point of Sale systemd. Internet payment-e. Address check for verification of a loan application
91 Which kind of an investor should choose to invest in Money Market Securities?Answer:a. Investor looking for capital gainsb. Investor looking for liquidityc. Arbitrageur
d. Investor looking for regular incomee. None of the listed Options
92 SWIFT is a ______________________.Answer:a. Proprietary network interfaceb. Open standard network interfacec. Message based network interfaced. Both open standard network interface AND message based network interface-e. Both proprietary network interface & message based network interface
93 Two Financial Institutions A & B conducted the following transactions over CHIPS on 30th Jan 2004.A transferred $5m to B at 9:45 AM B transferred $10m to A at 11:30 AM A transferred $12m to B at 2PM B transferred $15m to A at 3:30PM Which of the following holds true?
Answer:a. At the end of the day, $17m will be transferred to Bb. At the end of the day, $25m will be transferred to A-c. At the end of the day, $8m will be transferred to Ad. All the transactions would settle individually real-timee. Both, at the end of the day, $17m will be transferred to B AND at the end of the day, $25m will be transferred to A
94 Research analysts do all of the following except ____________________.Answer:a. Follow stocksb. Follow bonds-c. Invest of behalf of the Investment Bankd. Make buy / sell recommendationse. Collect and analyse data on stocks and bonds
95 Which of the following is not a repayment method?Answer:a. Post dated checksb. Salary deductionsc. Direct receiptsd. Direct debits-e. All of the listed options are repayment methods
96 Coupon rate on a bond represents which of the following?Answer:a. Face value of the bondb. Maturity duration of the bondc. Credit rating of the bond-d. Interest paid to the bondholderse. Financial performance of the bond issuer
97 Which of the following is not a characteristic of money markets?Answera. They trade in a central location.b. They have an active secondary market.c. They are wholesale markets.
d. They are beyond the reach of small investors.e. They trade in short term instruments.
98 VaR is used for which of the following?Answer:-a. Risk Measurementb. Risk Mitigationc. Risk Takingd. Risk Assumptione. None of the listed Options
99 The Japanese Index is known as?Answer:a. Straits Times-b. Nikkeic. Footsied. DAXe. CAC
100 Which of the following is the most profitable for Credit Card Company?Answer:a. Customers who always pay in timeb. Customers who never pay-c. Customers who default but finally payd. All of the listed optionse. None of the listed Options
1. If an investment pays interest at an annual rate of 5% per year, compounded twice a year than the effective yield larger than 5.5%
a. True b. False
2. In a 2 way quote for a share the bid is a. 2% less than offerb. Less than offerc. More than offerd. Dependent on dealer’s skille. Equal to offer
3. Which of the following is usually not participant in stock marketa. Small individual’s investorsb. Central banks c. Companiesd. Financial institutions
4. In an account saving simple interest from the first year is reinvented at the beginning of the second year?
a. True b. False
5. Which of the following is a not current asset?a. Goods for sale inventoryb. Terms loans
c. Cashd. Raw material inventorye. Receivables
6. Which of the following in not a feature of private banking?a. Specialist adviceb. Lot of researchc. Commercial lendingd. High investment in technologye. Understanding the capital and investment needs.
7. Retail loans are asset product offered by the bank a. True b. False
8. If the price of share pf cognizant changes from 65 to 60 this can be attributed to: a. Market riskb. Interest rate riskc. Credit riskd. Operational riske. Liquidity risk
9. Account maintained in the home currency by one bank is the name of another bank based abroad is called as:
a. Current accountb. Nostro accountc. Vostro accountd. Forex accounte. Overseas account
10. Which of the following is not the settlement method for bank loans?a. Pre-closureb. Assignmentc. Participationd. Sub participatione. Securities repository
11. The process of transferring obligation from one party to another is called Ans:Novation
12. The purchase of any stock for immediate delivery is a __ market transaction.a. Futuresb. Spotc. Forward
d. Stocke. Option
13. In the historical simulation method of VaR calculation:a. Return are assumed to be not normally distributedb. No assumption is made about the distributionc. Random returns are generated to calculate VaRd. Return are assumed to be normally distributede. Returns are not required at all.
14. What happens when interest rate fall:a. Bond prices increaseb. Bond prices decreasec. Bond prices do not changed. Economy goes into deflatione. Interest rate never fall, they always go up.
15. If the price of a security on day 1&2 is $102 and $100 respectively. The return isa. -2%b. 2%c. -1.96%d. Very highe. 1-2%
16. If you invest $1000 for 3 years at 7% compound interest, how much will you have at the end of the 3 years?
a. $1225b. None of listed optionc. $1000d. $1070e. $1270
17. The trade finance the term LC stands for;a. Letter of commercialsb. Letter of credit worthinessc. Letter of creditd. Letter of commercee. Letter of complaints
18. What is need for banks in the society?a. Small investor are protected, hence it is a low risk investment avenue.b. Banks are in the best position to lend out money at competitivec. Depositors are participant in primary and secondary markets.
d. All of listed options.
19. A is more risk averse investor than B .therefore.a. For the same return, B tolerates lesser risk than B.b. For the same return, A tolerates higher rate of return.c. For the same return, A tolerates lower rate of return.d. For the same return, A takes higher risk.
20. Liquidity issues of credit can be addressed by:-a. Sweep facilityb. Structured lending to clientc. Alld. Short term credit facilitiese. Overdraft
21. Which is associated with purpose of regulating financial institution?a. Noneb. To provide stability of money supply.c. To serve certain social objectives.d. To prevent failure of any financial institution.e. To offset moral hazard incentive provided by deposit insurance and other
guarantees.
22. Fastest method for calculating VaR.a. Monte- Carlo simulation. b. All equal time with software.c. Variance-Covariance matrix.d. Combination of Monte- Carlo and Historical Simulation.
23. Which is not banks primary use for deposits?a. Payment to employers b. Nonec. Investmentd. Loane. Withdrawal
24. If the 5 bids available for stock are 64, 65, 63, 62.5 and 66 which one u will sell? -> 66
25. When a bank issue a loan its liabilities & reserves increases by the amount of the loan.a. True b. False
26. If the corporate isn’t able to raise money from the market to pay off some loans the risk can be refer.
a. Market risk
b. Interest rate riskc. Commodity riskd. Operational riske. Liquidity risk
27. On the trading day at the NYSE a broker undertakes the following trades Buy 100 IBM shares for $10.00 each Sell 50 IBM shares for $10.50 each Buy 100 MFST share for $20.00 each Sell 20 IBM shares $11 each Sell 10 MFST share at 20.50 each Sell 30 IBM shares for 9.00 eachHow much did the broker pay out to the exchange in total in case of (i) Gross settlement system (ii) Net Settlement System?
a. (i) $1780 (ii) $3000b. (i) 0 for IBM, $1795 for MSFT (ii) $1780. c. (i) $3000 (ii) $1780d. Nonee. (i) $1780 (ii) 0 for IBM, $1795 for MSFT
28. US export and Europe import agree to carry out the transaction of goods word $100000 under a confirmed term LC with a maturity date of 60 days from the time of shipment. The acceptance commission @ 1.5 % PA equals
A) $2500B) $3000C) $300D) none E) $250
29. Operational risk is defined as? fail because of weakness in people, processes, systems or external events.
30. The basic four parties involved in any transaction using LC are the following EXCEPT
A) Issuing Bank B) Reimbursement Bank C) Beneficiary Bank D) Seller E) Buyer
31. While providing security lending services to its clients which risk will a custodian have to manage for its clients
A) Liquidity risk B) Both Credit risk and interest rate risk C) Interest rate risk D) Credit risk E) Both credit risk and liquidity risk.
32. If the price of securities on day 1 and 2 are $100 and $102 respectively .Returns is A) A very high B) 2 C) -1 D) -2 E) 1
33. Following are the list of risk that Cognizant faces at organizational level
A) Currency risk B) Attrition C) Credit risk D) All of the above E) Protective legislation by US/UK
34. Which of the following is not a core private banking function?
A) Client management B) Deposit Mobilization C) Investment analysis and advice D) Research E) Sales and Marketing
35. A mutual fund with investment objective of achieving high capital growth approaches investor services firm for advice. The firm advices the mutual fund to invest 80% of the fund in govt debt and 20% in equity. The allocation towards debt advised by the firm
A) Cannot be determined B) is too high C) Is about right D) is too low
36. Which of the following operations can be done on a LC?
A) All the listed option B) Acceptance C) Negotiate D) Purchase E) Discount
37. Who among the following is most likely to be a private banking client of a bank?
A) A fresh engineer in his first job at cognizant B) Tiger Woods C) Any of the above D) A cricket player who has never played national / international cricket E) A manager at a manufacturing plant.
38. Which of the following method eliminate country risk and commercial risk upon confirmation?
A) Documentary collection B) Back to back LC C) LC D) Standby LC E) Both standby LC and LC
42. The act of the loan amount being handed over to the borrower by the bank is known as disbursement. State TRUE or FALSE -> TRUE
39) On the trading day at the NYSE a broker undertakes the following trades Buy 100 IBM shares for $10.00 each Sell 50 IBM shares for $10.50 each Buy 100 MFST share for $20.00 each Sell 20 IBM shares $11 each Sell 10 MFST share at 20.50 each Sell 30 IBM shares for 9.00 eachGiven that a net settlement system is being used, find out the net position of the broker at the end of the day
A) IBM no exchange of shares ; MFST 90 shares to receive ; $1780 to pay out to the exchange
B) None of theseC) IBM no exchange of shares ; MFST 90 share to receive ; $3000 to pay out to exchangeD) IBM 70 shares to given out ; MFST 90 shares to receive ; $3000 to pat out to exchangeE) IBM no exchange of shares ; MFST 90 share to receive ; $1780 receive from the
exchange
40. ACH transaction involves the transmission of _________A) All of the listed option B) DocumentsC) Physical instrument like check and draftD) Electronic data filesE) Cash
41. What should one use while using comparing mortgages?
A) APRB) NoneC) IRRD) NPVE) Rate of interest applicable for the loan
43. Which one of the following is not offered by investment banking division of a bank? A) learning servicesB) ‘NoneC) Merger and Acquisition D) Valuation of firmE) Underwriting and distribution of equity issues.
44. If total spread on underwriting is $500000 and manager fee is $100000. What is the amount which will be distributed in the syndicate?
A) 500000B) 100000C) 400000D) 600000E) Can not be determined
45. HPPL shares are currently selling for $25 each. You bought 200 shares one year ago at $24 each and received dividend payment as $1.50 per share what was total dollar capital gain this year
A) 200B) 500C) NoneD) 300E) 400
46. The brokerage firm is regulated by A) State regularity agencyB) SECC) Industry wide SRO
D) All of the listed option
47) Pick odd one outa. Dematb. Personal loanc. Noned. Hire Purchasee. Auto loans
48. I deposited 100 in a bank .Bank loan out 90 out of it to someone else, who then invest the money in setting u a new factory. This process is called
A) Monetary policyB) NoneC) Money multiplier effectD) Profit making tendency of a bankE) Fiscal policy
49. Capital adequacy ratio refers to A) Amount of bank capital expressed as % of the risk weighted credit exposure & market
risk.B) Amount of bank capital expressed as % of the risk weighted credit exposure C) Amount of bank capital expressed as % of the risk weighted credit exposure & operational
risk.D) Amount of bank capital expressed as % of the risk weighted credit exposure
operational risk & market risk.E) None
50. Which of the following is not a treasury management system?A) CalypsoB) SummitC) Wall street systemD) Front arenaE) Flex cube
51. Syndicate helps in all of the following activity but A) Managing large bond issuesB) Raising huge money from the bankC) Managing large capital raising act D) Managing conflict between investment banks.E) IPO distribution.
52. All of the following statements concerning US govt securities are correct EXCEPT A) Treasury bills have their interest paid in a lump sum at maturityB) NoneC) Treasury bills have greater interest risk than either treasury bond or treasury note
D) Treasury note has maturity dates up to 10 yrsE) Treasury bonds have maturity dates up to 30 yrs
53. In defined benefit plan the benefit is expressed as ________ and in defined contribution plan the benefit is expressed as an ________
54. What is the term used to indicate the arrangement of LARGE borrowing for a corporate by a group as lenders
A) noneB) SyndicateC) AllocationD) AssignmentE) Secondary
55. Card associate provide which of the following service A) issue cardB) Set credit limitsC) Set interest ratesD) Set card feesE) Security/ Risk management
56. in an international securities transaction, which of the following participant will not be involved
A) Global custodian , domestic sub custodian , depository in foreign country and sometime stock exchange in foreign country
B) Depository in foreign country C) Global CustodianD) stock exchange in foreign countryE) domestic sub custodian
57. An insurer undertakes an analysis of a portfolio of insurance policy by exploring scenarios for the path followed by swap rates, policy surrender rates, mortgage prepayment rates for the mortgage backed security in the portfolio, what is this process called
A) Cash projectionB) Investment manages universeC) Asset allocationD) Fund administration
E) Asset / liabilities analysis
58 Trade finance helps in A) Facilitating international transaction B) Facilitating intra company transaction C) Facilitating international transaction , corporate lending and settling up of new factoriesD) Facilitating corporate lendingE) Facilitating setting up of new factories
59. A choice quote is A) a price at which a firm is ready to buy or sellB) When bid is equal to offer C) When the firm has a choice of deciding the securities to takeD) a price at which a firm is ready to buy or sell it also means when bid is equal to
offer
60. Which of the following is likely to have the highest interest rate?A) 6 month deposit of min balance of $1000B) 3 month deposit of min balance of $4000C) 12 month deposit of min balance of $1000D) NoneE) 6 month deposit of min balance of $2000
61. If 1 day VaR is $1 million, 9 day Var is A) $3mnB) $4.5 mnC) $9mnD) $4.4mnE) $1mn
62. If a bank gets a deposit of $1000 assuming a CRR of 10% and that it circulates through 2 more banks, leading to the following money multiplier effect
A) Loan of $2439B) Loan of $1710C) NoneD) Create a reserve of $100E) Create a reserve of $190
63. Which among the following is an investment company that pools money from unit holders and invest in a variety of security?
A) Mutual FundB) Mortgage CompanyC) NoneD) Stock Exchange
64. You purchased a stock for $40. 1 year later you received $2 as Dividend. You sold it at $48. What is your return?
a. 45%b. 10%c. 25%d. 50%e. None
65. A formal Legal commitment to extend credit to some max amount over a state period of time is description of
a. Trade Creditb. Revolving Creditc. Agreement Irrevocable Creditd. Line of Credite. Letter of Credit
66. Odd 1 outa. Warren Buffetb. George Sorosc. Bill Gatesd. Ben Grahame. Peter Lynch
67. Development of Investment Objective and Investment policy falls under the Purview ofa. Investment manager Universeb. Asset Allocationc. Asset Liability Analysisd. Fund Admine. Compliance Reporting
68. Interest Rate Spread is equal toa. Current rate – Base Rateb. Cap – Current Ratec. Current Rate – Floord. Base Rate – Floor
69. Which of the following factors affect the choice of Payment Method?a. Exporters Fundb. All c. Government Guarantee Programd. Time Framee. Cost of Financing
70. The NYSE is a large financial market in which the initial issue receives the proceeds for the Sale of securities.
a. True b. False
71. Which of the following trading services reduces the trading cost for institutional investors?
a. Stock Repurchase Programb. Transition Managementc. Transition Management & Commission Recaptured. Commission Recapture e. None
72. A CALL option on futures gives the buyera. the obligation to buy a futures contractb. the obligation to sell a futures contractc. the right & obligation to buy a futures contractd. the right but not the obligation to buy a futures contracte. the right but not the obligation to sell a futures contract
73. Which is not an example of Option?a. Call Optionb. Swaptionc. Leapsd. Oil Futurese. Put Options
74. Some banks pay interest on Checking A/c while many do not.a. Trueb. False
75. The advising bank is called as trusted bridge between the ___________ & __________ when they do not have active relationship. Options wrong
a. Beneficiary Bank & Reimbursing Bankb. Importer Exporterc. Reimbursing Bank & Beneficiary Bankd. Issuing Bank & Confirming Bank
The advising bank is used as a trusted bridge between the applicant’s/issuing bank and the beneficiary’s bank when they do not have an active relationship.
76. Which of the following according to you has resulted in defining contribution plans gaining popularity over defined benefit plans
a. DC plans fix the monthly contribution from the employee making his financial planning easier.
b. DC plans are seen by employees as investment which to accumulate retirement income.c. Alld. Employer increasing wants employees to share responsibility for retirement
77. ________is typically largest part of spread and is paid to broker\dealer or that actually took clients order
a. Salaryb. Manager feec. Waged. Concessione. Underwriter
78. NASD is not an SRO for a. Listed marketb. Over the counter marketc. Third marketd. Fourth market
79. High net worth individuals generally have ____________.a. Market capitalization more than $200000b. Allc. Net worth greater than $500000d. Household income of max $50000 year.
80. Which is true about retail banking? a. The business focuses on small no. of high net worth individuals.b. The business focuses on small and medium enterprises.c. The business focuses on large no. of individuals.d. The business focuses on large no. of corporation bodies.
81. Offer is price at which a firm a. Trades in securitiesb. Quotes to its bets customerc. Intends to buyd. Intends to selle. Quotes when it does not want to trade.
82. Securities with original maturity greater than 1 year are traded on money market.a. True b. False
83. Which is not a banking service?a. Stock market b. Retail banking c. Corporate bankingd. Customer lending
84. Which is true?a. Financer owns the asset both in case of ‘Lease’ and ‘hire Purchase’.b. Tax deduction cab be claimed fro the full value of the rental paid in case of leasec. Alld. Depreciation in claimed by the financer in lease and not in case of hire purchase.
85. Bank a based in US provides safe keeping services for securities to its US clients. It also has clients in France and Belgium and provides securities safe keeping services to these clients through banks C & D respectively. Which best describes bank A?
a. Global custodianb. None c. Main custodiand. Sub custodiane. Secondary custodian
86. All following statements relating to Bonds are correct except.A) Bonds sell at a discount when Coupon Rate is less than Market Interest rate.B) NoneC) Bond is debt instrument giving issues.
87. Which of the following type of loan requires the amount of interest that would be earned on the loan to be paid upfront by the borrower?
88. Who are involved in the preparation of prospectus of IPO?A) Commercial bankersB) Investment BankersC) NoneD) Company ManagementE) Company Management and Investment Bankers
89. Bankers Acceptance differs from Sight Draft in that A) Bankers Acceptance reduces lending capacityB) Sight Drafts are negotiable instrumentsC) Bankers Acceptance demands immediate payment.D) NoneE) Banks can raise funds by selling acceptance.90. Clients of a private banker are generally not segregated on the basis of A) Investible assetsB) LocationC) AgeD) Net worthE) Name
91. The initial sale of the security is in the ………market, while subsequent trading in the security is in the …….. market
A) Spot, futuresB) Debt , Equity
C) Primary , SecondaryD) Money, CapitalE) Secondary, Primary
92. Under what category can services like asset/liability analysis, asset allocation, cash projection, compliance reporting, fund administration, investment Management universe etc. provided by an institution can be classified?
A) Investment ManagementB) Asset ServicingC) NoneD) TradingE) Investor Services.
93. CIP in the context of anti-money laundering is A) AllB) Stands for Suspicious Activity Reports C) Customer Identification ProgramD) Requiring Businesses, which were only to report cash transactions involving more than
1.00,000?
94. On a trading day at a stock exchange a broker undertakes the foll trades:Buy 100 IBM shares for 10$ eachSell 50 IBM shares for 10.5 $each Buy 100 MSFT shares for 20$ eachSell 20 IBM shares for 11$ eachSell 10 MSFT shares for 20.5 eachSell 30 1bm shares for 9$ eachAt the end of the day, the broker owes 1780 to the exchange while exchange owes him
90 shares of MSFT. Is it possible?A) Yes under RTGSB) NoC) Yes under net-settlement system
95. Dow Jones industrial average is made ofA) 30 stocksB) 20 stocksC) 40 stocksD) 10 stocksE) 50 stocks
96. Which is the key feature of Letter of Credit?A) basis for devising proper currency hedging strategyB) Distributes risk between buyer n sellers.C) basis for devising proper currency hedging strategy and opportunity for receiving payment in advance of the due date.D) All
E) Opportunity for receiving payment in advance of the due date.
97. Which risks bring gain and losses?A) Interest rate and foreign exchange B) Liquidity and creditC) Credit and Interest rateD) Credit and Foreign exchangeE) All
98. Find the future value of $1200 invested at 5.25 % per annum payable annually after 6 months? Marks: 2
1. 1345.12. 1243.13. 1231.14. None5. 1235
99. Investor services like brokerage, cash management and short term investments, commission re-capture, foreign exchange transactions, transaction management etc. can be classified under ____ group of services. Marks: 1.
101. The term CP is used in corporate lending for ____. Marks: 11. Collateral provision2. Client Partner3. Commercial Paper4. Commodity Put options5. Credit Provision
102 What are the risks associated with the Hedge funds? Marks: 31. All of the above2. High exposures in derivatives3. High Leveraging 4. High Speculation
103. The trade terms “15/2 net 30”indicates that _____. Marks: 3a. 2% discount is offered if payment is made within 15 days.
b. 15% discount is offered if payment is made within 2 days; the payment should however be made in 30 days.
c. 30% discount is offered if payment is made before 15 of the month.d. 15% discount is offered if payment is made between 2 & 30 days;e. 15% discount is offered if payment is made within 30 days.
104. A bank is required to hold reverses at least equal to a pre-scribed fraction of its total deposit liabilities.
a. True b. False
105 What term is used to describe n LC that remains valid for years thereby eliminating the cost of separate LC’s for each transaction with a regular client?
a. Irrevocable LCb. Nonec. Red claused. Revolving LCe. Evergreen clause
106 Who appoints investment manager to manage a benefit plan?a. Plan sponsorb. Plan administratorc. Fund trusteed. Nonee. Government
107 A company would pay the interest on what portion of loan?a. Committed amountb. Either disbursed or committed loanc. Unused amount of loand. Disbursed amounte. None
108 In the exchange on a particular trading there is a buy market order for 100 CTSH shares and two sell market orders for 50 and 40 CTSH shares each, can the buy order be matched against the two sell orders.
a. Yesb. Noc. Yes, but if prices on the buy & sell side match.
109 If the limit = $2000, margin = 20% and asset value = $2000 then drawing power for an open ended loan is equal to?
111 A fixed income analyst will analyze all buta. Municipal bondsb. Bonds of govt. sponsed enterprisec. Corporate bondsd. US treasuriese. Shares
112 In benefit administration what are the relationships that exits between the plan administrator and the investment manager, and between Trustee and the investment manager.
a. Noneb. Plan administrator & trustee both have outsourced plan administration as well as fund
management to investment managerc. Anyd. Plan administrator gives investment instruction to investment manager while
trustee appoints the investment manager.e. Trustee gives investment instruction to investment manager, while plan administrator
appoints the investment manager.
113 Which entity provides credit scores that are used by issuers to process card application?
114 CPI stands for which of the following?a. Consolidated Price indexb. Consument popularity indexc. Consumer product indexd. Consumer price indexe. None
115 A bank decides to sanction only 10% of the loan sought by a company. The company goes and pledges extra assets with the bank and the bank then agree to sanction 50% of the loan sought. The company has indulged in the process of
126 In defined contribution retirement plan .Tax sheltered annuities fall under section of _________ERISA403b401k401b403kNone
126 In benefits administration, trustee and plan administrator submit compliance report to______ which in turn qualifies the plan.ParticipantNone (answer is TRUST)GovernmentInvestment managerSponsor
127 Full form of ADR
Answer: American Depository Receipts
128 Question related to BASEL IIAnswer: Capital adequacy
129 What is interest rate charged on asset based loan?Answer: The interest rate charged is lower than personal loans
130 Question related to credit derivatives as which of the following function is not done by credit derivativesAnswer: Answer was something as Transfer to over the counter
131 Question related to credit derivatives it was fill up the blanks? Exactly don’t remember the question/Answer: option having “TRANSFER”
132 Question related to non-discretionary Investment ManagementAnswer: the bank offers investment recommendations based on the Client’s approval.
133 Question having few options like Income Processing, Tax Information Services, Cash SweepAnswer: ASSET SERVICING 134 Question related to Underwriting?Options:
1. Underwriting Spread2. Public Offering Price (POP),3. Lead or Managing Underwriter is the Underwriting Agreement.(not sure about it)4. All
Answer is ALL the listed option
1. Risk Matrices was developed by:- JP Morgan, Bank of California, Credit Suisse, SBI2. Research analyst may recommend to :- buy, hold and sell3. Reducing CRR for banks would have impact on:-
a. Increased money supplyb. Reduced interest ratesc. Reduced money supply in the economyd. Profitability of firmse. None
4. Under corporate stock repurchase programa. Corporate purchase their own shares from shareholders
5. Private banking providing risk management services strives to:-a. Eliminate risk and maximize returnsb. Eliminate risk without worrying about returnsc. Reduce risk and optimize returnsd. Avoid risk and returnse. All
f.6. One would go for bank deposits because
a. Money easily availableb. Interest earnedc. Insurance cover availabled. All
7. Basic 4 parties involved in any transaction using letter of credit are following excepta. Issuing bankb. Buyerc. Reimbursement bankd. Sellere. Beneficiary bank
8. From seller’s point of view which method has least riska. LCb. Direct debitc. Documentary collectiond. Counter tradee. Cash in advance
9. ABC rated as AA+ and XYZ rated D. Who gets loan from banka. Equally unlikelyb. Equally likelyc. ABCd. XYZe. None
10. Which is not the settlement method for bank loans?a. Pre-closureb. Assignmentc. Participationd. Sub participatione. Securities repository
11. Which is correct hierarchy of corporate ratings (high to low)?a. AAA,AA+,BBB,D
12. Inflation- 9%. Future value of 100 units of money after 2 years:a. 118.8b. Exactly 100c. Exactly 200d. Around 109e. None
13. Brokerage firms are regulated by
a. SECb. Industry wide SROsc. State regulatory Agencyd. All
14. Odd man out:-a. SECb. NYSEc. NASDAQd. LSEe. NSE
15. From investor stand point a debenture issued by excellent company will appear risky than share of preferred stock issued by excellent company
a. Trueb. False
16. Risk associated with hedge funds:-a. High exposure in derivativesb. Allc. High speculationd. High leveraging
17. Not a feature of private banking:-a. High investment in technologyb. Lot of researchc. Commercial lendingd. Specialist advicee. Understanding capital and investment needs
18. Which of the following affects the choice of payment methoda. Allb. Government guarantee methodc. Exporter’s fundd. Time framee. Cost of financing
19. Which risk may bring gains and losses?a. Credit risk and interest rate riskb. Allc. Liquidity risk and foreign exchange riskd. Credit risk and foreign exchange risk
20. Bankers acceptance differs from sight draft in thata. Sight drafts are negotiable instrumentsb. Bankers acceptance demand immediate payments
c. Bank can raise funds by selling acceptanced. Bank acceptance reduces banks lending capacitye. None
21. Formal legal commitment to extend credit up to some maximum amount over a period of time is a description of
a. Line of creditb. Irrevocable creditc. Letter of creditd. Revolving credit agreemente. Trade credit
22. Security settlement is function of a. Specialistb. Tradersc. Back officed. Front officee. Mid office
23. Which of these instruments is not included as part of asset servicing services and the category “Pricing/ Holdings” Valuation which includes accurate pricing, rating etc.
a. Equitiesb. Certificate of participationc. Government securitiesd. Certificate of deposite. Services may be provided for all
24. Which of the following is involved in retails brokerage business in USa. E-tradeb. Charles Schwabc. Sallie Maed. Federal reservee. a and b both
25. Measures of performance of an investment portfolio are all of the following except:-a. Risk adjusted returnb. Style maps scorec. Profit/loss on portfoliod. Alphae. Up/down market analysis
26. Interest rate spread:-a. Current rate – floorb. Cap – current ratec. Current rate-base rated. Base rate-floor rate
e. None
27. Who insures stocks in stock marketa. Security and exchange commissionb. Federal deposit insurance corporationc. Us department of treasuryd. None
28. NASD is not an SRO fora. 4th marketb. 3rd marketc. Listed marketd. 2nd markete. OTC market
29. Which of the following loan requires the amount of interest that would be earned on the loan to be paid upfront by borrower:-
a. Discounted loansb. True discountc. Capitalizedd. Demande. Amortized
30. Limit = $2000 Margin=20% Asset value=2000 a. Drawing power = 1600
31. Over the counter market is also calleda. Unlisted marketb. 2nd , unlisted and OTC marketc. Unlistedd. Supere. 2nd market
32. Liquidity issues of credit can be addressed by:-a. Sweep facilityb. Structured lending to clientc. Alld. Short term credit facilitiese. Overdraft
33. Standby letter is _____ secure than documentary collection and cheaper than ____a. More, commercial LOC
34. Which is not an optiona. Callb. Put
c. Swaptiond. Oil futurese. Leaps
35. question on top 10 US bank – REBO
36. ACH transaction involvesa. Cashb. Electronic datac. Docsd. Checks and draftse. All
37. Interest rates fallsa. Bond prices increaseb. Bond prices decreasec. Do not changed. Economy goes to deflation
38. Rate at which bank purchases US dollars against home currency is :-a. Bid rateb. Indirectc. Direct d. Cross currencye. Ask rate
39 Offer price is the price at which the firmf. Intends to buyg. Intends to sellh. Trades in securitiesi. None
39. Bid price is the price at which the firmThe price at which market makers will buy or sell a particular security.
41 Presence of risk impliesa. Standard deviation of return is 0b. Uncertainties of final outcomec. Final wealth is lowerd. Investment gain
40. Company would pay interest on what portion of the loan?a. Disbursed amountb. Committed amountc. Bothd. Eithere. None
41. Odd man out?a. Equity
b. Stocksc. Sharesd. Convertible bondse. Common stock
42. A bank cannot cover the money demanded by depositor, then it goes out to – a. Federal reserve bank
43. Institutions involved in benefit administration process, discussing plansa. Sponsorb. Custodianc. Plan administrationd. Record keepere. Participant
44. Which of the following eliminates both country risk and commercial risk?a. Both standby LOC and LOC
45. When bank goes to the fed to borrow funds then the interest rate charged by fed is known as
a. Prime rateb. Bond ratec. Discount rated. Federal rate
46. Risk Matrices was developed by:- JP Morgan, Bank of California, Credit Suisse, SBI47. Research analyst may recommend to :- buy, hold and sell48. Reducing CRR for banks would have impact on:-
a. Increased money supplyb. Reduced interest ratesc. Reduced money supply in the economyd. Profitability of firmse. None
49. ___ is the largest part of spread and is paid to broker/dealer that actually took the clients order
a. Salaryb. Wagec. Manager’s feed. Concessione. Underwriter’s allowance
50. What is the term used to indicate the arrangement of large borrowing for a corporate by a group of lenders?
a. Syndicateb. Secondaryc. Assignmentd. Nonee. Allocation
51. If a price of share changes from 65 to 60 this can be attributed to:a. Market risk
b. Interest rate riskc. Credit riskd. Operational riske. Liquidity risk
52. Under corporate stock repurchase programa. Corporate purchase their own shares from shareholders
53. Private banking providing risk management services strives to:-a. Eliminate risk and maximize returnsb. Eliminate risk without worrying about returnsc. Reduce risk and optimize returnsd. Avoid risk and returnse. All
54. Which will have highest interest ratea. 3 months deposit with min balance of $4000b. 12 months -> $1000c. Cannot determined. 6 months -> $2000e. 6 months -> $1000
55. One would go for bank deposits becausea. Money easily availableb. Interest earnedc. Insurance cover availabled. All
56. Basic 4 parties involved in any transaction using letter of credit are following excepta. Issuing bankb. Buyerc. Reimbursement bankd. Sellere. Beneficiary bank
57. From seller’s point of view which method has least riska. LCb. Direct debitc. Documentary collectiond. Counter tradee. Cash in advance
58. ABC rated as AA+ and XYZ rated D. Who gets loan from banka. Equally unlikelyb. Equally likelyc. ABCd. XYZe. None
59. Which of the following can be done on LC?a. Negotiateb. Purchasec. Acceptanced. Discount
e. All60. Which is not the settlement method for bank loans?
a. Pre-closureb. Assignmentc. Participationd. Sub participatione. Securities repository
61. Which is correct hierarchy of corporate ratings (high to low)?a. AAA,AA+,BBB,D
62. Purchase as $40. A year later got dividend $2. Sold at $48. What is holding period return?a. 10%b. 25%c. 45%d. 50%e. None
63. Inflation- 8%. Future value of 100 units of money after 2 years:a. 118.8b. Exactly 100c. Exactly 200d. Around 109e. None
64. Brokerage firms are regulated by a. SECb. Industry wide SROsc. State regulatory Agencyd. All
65. Odd man out:-a. SECb. NYSEc. NASDAQd. LSEe. NSE
66. From investor stand point a debenture issued by excellent company will appear risky than share of preferred stock issued by excellent company
a. Trueb. False
67. Risk associated with hedge funds:-a. High exposure in derivativesb. Allc. High speculationd. High leveraging
68. Not a feature of private banking:-a. High investment in technologyb. Lot of researchc. Commercial lendingd. Specialist advice
e. Understanding capital and investment needs69. Which of the following affects the choice of payment method
a. Allb. Government guarantee methodc. Exporter’s fundd. Time framee. Cost of financing
70. Which risk may bring gains and losses?a. Credit risk and interest rate riskb. Allc. Liquidity risk and foreign exchange riskd. Credit risk and foreign exchange risk
71. Bankers acceptance differs from sight draft in thata. Sight drafts are negotiable instrumentsb. Bankers acceptance demand immediate paymentsc. Bank can raise funds by selling acceptanced. Bank acceptance reduces banks lending capacitye. None
72. Formal legal commitment to extend credit up to some maximum amount over a period of time is a description of
a. Line of creditb. Irrevocable creditc. Letter of creditd. Revolving credit agreemente. Trade credit
73. Odd man outa. Noneb. Auto loansc. Demat d. Hire purchasee. Personal loan
74. A choice quote is a pricea. At which a firm is ready to buy or sellb. Where firm has a choice of deciding the security to takec. A option and it also means when bid is equal to offerd. When bid=offer
75. A bank gets a deposit of $1000 assuming CRR=10% and that is circulates through 2 more banks, leading to following money multiplier effect:-
a. Create a reserve of $100b. Create a reserve of $190c. Noned. Loans of $1710e. Loans of $2439
76. Security settlement is function of a. Specialistb. Traders
c. Back officed. Front officee. Mid office
77. Which of these instruments is not included as part of asset servicing services and the category “Pricing/ Holdings” Valuation which includes accurate pricing, rating etc.
a. Equitiesb. Certificate of participationc. Government securitiesd. Certificate of deposite. Services may be provided for all
78. Which of the following is involved in retails brokerage business in USa. E-tradeb. Charles Schwabc. Sallie Maed. Federal reservee. a and b both
79. Measures of performance of an investment portfolio are all of the following except:-a. Risk adjusted returnb. Style maps scorec. Profit/loss on portfoliod. Alphae. Up/down market analysis
80. Interest rate spread:-a. Current rate – floorb. Cap – current ratec. Current rate-base rated. Base rate-floor ratee. None
81. Who insures stocks in stock marketa. Security and exchange commissionb. Federal deposit insurance corporationc. Us department of treasuryd. None
82. NASD is not an SRO fora. 4th marketb. 3rd marketc. Listed marketd. 2nd markete. OTC market
83. Which of the following loan requires the amount of interest that would be earned on the loan to be paid upfront by borrower:-
a. Discounted loansb. True discountc. Capitalizedd. Demande. Amortized
84. Limit = $2000 Margin=20% Asset value=2000 a. Drawing power = 1600
85. Over the counter market is also calleda. Unlisted marketb. 2nd , unlisted and OTC marketc. Unlistedd. Supere. 2nd market
86. Liquidity issues of credit can be addressed by:-a. Sweep facilityb. Structured lending to clientc. Alld. Short term credit facilitiese. Overdraft
87. Standby letter is _____ secure than documentary collection and cheaper than ____a. More, commercial LOC
88. Total spread of underwriting = 500000 and manager fee = 100000 and distributed in syndicate=?
a. 600,000b. 400,000c. 100000d. 500000e. Cannot determine
89. Price of security on day 1&2 is $100 and $102 respectively. The return isa. -2%b. 2%c. -1.96%d. Very highe. 1-2%
90. Which is not an optiona. Callb. Putc. Swaptiond. Oil futurese. Leaps
91. question on top 10 US bank – read page number 5292. ACH transaction involves
a. Cashb. Electronic datac. Docsd. Checks and draftse. All
93. Interest rates fallsa. Bond prices increaseb. Bond prices decreasec. Do not change
d. Economy goes to deflation94. Rate at which bank purchases US dollars against home currency is :-
a. Bidb. Indirectc. Direct d. Cross currencye. Ask rate
95. Offer price is the price at which the firma. Intends to buyb. Intends to sellc. Trades in securitiesd. None
96. Presence of risk impliesa. Standard deviation of return is 0b. Uncertainties of final outcomec. Final wealth is lowerd. Investment gain
97. Company would pay interest on what portion of the loan?a. Disbursed amountb. Committed amountc. Bothd. Eithere. None
98. Odd man out?a. Equityb. Stocksc. Sharesd. Convertible bondse. Common stock
99. A bank cannot cover the money demanded by depositor, then it goes out to – a. Federal reserve bank
100. Institutions involved in benefit administration process, discussing plansa. Sponsorb. Custodianc. Plan administrationd. Record keepere. Participant
101. Which of the following eliminates both country risk and commercial risk?a. Both standby LOC and LOC
102. When bank goes to the fed to borrow funds then the interest rate charged by fed is known as
a. Prime rateb. Bond ratec. Discount rated. Federal rate
103. CP full form in corporate lending … a. commercial paper
104. when was US PATRICAT ACT passeda. 2001
105. Risk aversea. less risk/avoid risk
106. full form of EMI. Ans) Equated Monthly Installment.
107. if day 1and day 2 share price is $100 and $102. return isa. 2%
108. if day 1and day 2 share price is $102 and $100. return isa. -1.96%
109. if share price of cognizant changes fronm $65 to $60 ,risk is a .market risk
67. which of the following is online settlement methoda. RTGS
68. how much you will get at end of 3 years if you deposits $1000 at 7% compound interesta. $1225
69. you bought 200 shares at $24. now share price is $ 25 and you got dividend of $1.50 your total return is
a. $50070. if u buy share at price$ 40 and now share price is $ 48 and u got dividend of $2 per share ur total return in % is
a. 25% 71. Which of the following is true for The Fed funds ratea. It is cost of borrowing immediately available funds for one day.72. corporate bonds are
a. always secured73. fastest method in calculating VaRA. covariance method
74. full form of VaRa. value at risk
75.if one day var is $ 1M, calculate var for 9 daysa. $3M
76. Which of the following is not a repayment method?Ans .collateral78. in credit scores who is involved?
a. Credit Bureau79. ATM stands for
1) Automatic Transaction Machine; Almost anytime banking2) Automated Teller Machine; Remote location transactions 3) Automatic Transaction Machine; Fund transfer between accounts
4) Automated Teller Machine; Direct Deposit5) Automatic Transaction Machine; Personal Banking
80. A Revocable LC (Letter of Credit) can be revoked without the consent of the Exporter can be revoked without the consent of the Exporter’s bank can be revoked without the consent of the Importer’s bank can’t be revoked with the consent of the Advising bank can’t be revoked without the consent of Exporter.
81. Which of the following are disadvantages of using LC (Letter of Credit)?(check box)a. Time consumingb. Costlyc. Specific and Bindingd. Deals with documents and not with productse. Credit Line tied up.
82. Capital adequacy ratio refers toa. Amount of bank’s capital expressed as percentage of the risk weighted credit exposure, operational risk & market risk
83. Banker acceptances are ________________ credit investment created by ___________ and used for financing imports, exports and domestic shipping
Long term; financial firms Long term; non-financial firms Short term; non-financial firms Short term; financial firms Medium terms; banks
84. Mutual funds a. Are less riskier than individual stocks as the fund managers invest in a diversified portfolio
85. Warrants a. Warrants are call options – variants of equity. They are usually offered as bonus or sweetener86. bank are least interested in giving a personal
a. credit scoresb. document verification
87. difference between lease & hire purchasea. all
88. To compare the cost of different Mortgages deals one should look at the a. APR
89. securitizing cash flows from future monthly sale of oil explored from its specified offshorea. asset securtisation90. not a Treasury Management Systems – Inter-bank91. pre shipment loans
a. Banks provide Pre-shipment finance - working capital for purchase of raw materials, processing and packaging of the export commodities.
92. function of A card Associationa. security/risk management
93. funtions of private banking95. not a Personal Investment Companies and private bank
96. risk associated with hedge funds97. function of CORPORATE FINANCE
a. all98. sales and brokers responds to which department when institution transfer their custody service from one to anothera. Transition management99. two questions from Netting and RTGS from pdf at page number 180-181100. who is at risk in defind benefit
a. employer101. difference between DB (defined benefit) and DC (defined contribution)102. BAFT stands for
Bankers Acceptance for Factoring Transactions Bankers Association for Foreign Trade Bankers Acceptance for Foreign transactions Bankers Association for Forfaiting & Factoring transaction Bankers association for Factoring Trade.
103. Corporate loans are .. Secured or unsecured , secured, unsecured104. Pick odd one out ..
1) merril lynch 2) george soros3) bell graham4) bill gates5) warren buffet
106. newyork, delhi, Jakarta, thimpu … --- > least risk in investing107. US, india, Pakistan, burma, Bhutan -- > beneficial for loan purpose 108. Which of the following is the most profitable for Credit Card Company?
1) Customers who always pay in time2) Customers who never pay3) Customers who default but finally pay4) all of the listed options5) None of the listed Options6) Customer who pays minimum due
109. Which is not the charge type ??
Pledge, hypothecation, lien, collateral 110. Money Multiplier effect would imply………
1) An increase in the total money lent out into the system2) An increase in the total money in the bank reserves in the system3) A decrease in the total money in the bank reserves in the system4) Both An increase in the total money lent out into the system and An increase in the total
money in the bank reserves in the system5) Both An increase in the total money lent out into the system and a decrease in the total
money in the bank reserves in the system
111. Which of the following is associated with the purpose of regulating financial institutions?
1) To provide stability of the money supply2) To serve certain social objectives3) To prevent failure of any financial institution4) To offset the moral hazard incentives provided by deposit insurance and other guarantees.5) Both To serve certain social objectives and To offset the moral hazard incentives
provided by deposit insurance and other guarantees.
112. Private banking is a fee driven business
113. Purely competitive financial market not characterized by, 1) govt. regulation2) cost effective trading 3) full information4) many traders
114. Open ended loan allow the borrower to borrow additional amount subject to the maximum amount less then a set value. 1) True2) False
115. investment bank assists in merger & aqisition..1) Structure and deals2) All 3) smooth transaction4) structure and deals
116. card association do ??1. Security/Risk management2. Issue cards3. Set credit limits4. Set interest rates
117. which is not a pre shipment loan 1. bill discounting2. raw material
118. nominal rate – 8% , rate of inflation – 2%, real rate of inflation ???1. 6%2. 10%
119. two way quote for share the bid
120. funding cost goes up due to Hardening interest rate … Risk ???
121. Federal funds rate: The rate domestic banks charge one another on overnight loans to meet Federal Reserve requirements. This rate tracks very closely to the discount rate, but is usually slightly higher.
122 . Warrant is combination of ….. 1. equities & futures2. call & put options3. call options
123. KYC refers to …1. checking old account2. checking sponsors credentials3. checking of credential of the customer4. checking of bank credential by the federal bank
124. STP stands for .. Straight Through Processing
125. Price weighted indexDow Jones Industrial Average
