QN201: When is a company required to file a prospectus with the regulatory authority? Answer: c) Within a certain timeframe after the company has issued its shares.
a) Before the company is incorporated.
b) After the company has issued all its shares.
c) Within a certain timeframe after the company has issued its shares.
d) There is no requirement to file a prospectus with the regulatory authority.
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QN202: Which of the following information is typically included in a prospectus? Answer: b) The price at which the shares are being offered.
a) Details about the company’s board of directors.
b) The price at which the shares are being offered.
c) The names of existing shareholders.
d) The personal backgrounds of the company’s executives.
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QN203: What is the role of the regulatory authority in relation to prospectuses? Answer: a) The regulatory authority reviews and approves prospectuses before they can be issued to potential investors.
a) The regulatory authority reviews and approves prospectuses before they can be issued to potential investors.
b) The regulatory authority assists companies in drafting their prospectuses.
c) The regulatory authority determines the number of shares a company can issue.
d) The regulatory authority ensures that existing shareholders receive a copy of the prospectus.
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QN204: What is the primary purpose of issuing shares and raising capital in a company? Answer: c) To fund the company’s operations and growth.
a) To increase the number of shareholders.
b) To generate profits for existing shareholders.
c) To fund the company’s operations and growth.
d) To reduce the company’s debt obligations.
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QN205: What is meant by an initial public offering (IPO)? Answer: c) The first time a company offers its shares to the public.
a) The issuance of shares to existing shareholders.
b) The issuance of shares to new investors in a private placement.
c) The first time a company offers its shares to the public.
d) The repurchase of shares by the company from the market.
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QN206: Which of the following methods is commonly used for raising capital through the issuance of shares? Answer: a) Rights issue.
a) Rights issue.
b) Debt financing.
c) Venture capital funding.
d) Profit sharing agreement.
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QN207: What is a rights issue? Answer: a) The issuance of shares to existing shareholders at a discounted price.
a) The issuance of shares to existing shareholders at a discounted price.
b) The issuance of shares to new investors at a premium price.
c) The repurchase of shares by the company from the market.
d) The conversion of debt into equity shares.
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QN208: What is the role of an underwriter in the process of raising capital through the issuance of shares? Answer: b) To advise the company on the optimal pricing of the shares.
a) To purchase shares directly from the company.
b) To advise the company on the optimal pricing of the shares.
c) To market the shares to potential investors.
d) To ensure compliance with securities regulations.
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QN209: What does “buyback of shares” refer to in corporate finance? Answer: a) The repurchase of shares by the company from its existing shareholders.
a) The repurchase of shares by the company from its existing shareholders.
b) The issuance of new shares to increase the company’s capital.
c) The transfer of shares from one shareholder to another.
d) The sale of shares by the company to new investors.
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QN210: What is the main reason a company might choose to buy back its own shares? Answer: c) To return surplus cash to shareholders.
a) To increase the number of outstanding shares.
b) To decrease the ownership stake of existing shareholders.
c) To return surplus cash to shareholders.
d) To raise additional capital for expansion.
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QN211: How are shares typically bought back by a company? Answer: b) Through an open market purchase on the stock exchange.
a) Through a private placement to institutional investors.
b) Through an open market purchase on the stock exchange.
c) By offering a higher dividend to existing shareholders.
d) Through a direct negotiation with each individual shareholder.
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QN212: What is a debenture? Answer: c) A long-term debt instrument issued by a company.
a) An equity investment in a company.
b) A document that represents a company’s ownership stake.
c) A long-term debt instrument issued by a company.
d) A legal agreement between shareholders and the company.
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QN213: How are debentures typically repaid by the company? Answer: b) By returning the principal amount to debenture holders at maturity.
a) Through the issuance of additional shares.
b) By returning the principal amount to debenture holders at maturity.
c) By converting the debentures into equity shares.
d) By distributing the debentures to existing shareholders.
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QN214: Question: Which of the following is a valid power of a director in a company? Answer:d) All of the above
a) Approving financial statements
b) Hiring employees
c) Declaring dividends
d) All of the above
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QN215: Question: What is the minimum number of directors required for a public company in India? Answer:c) 3
a) 1
b) 2
c) 3
d) 5
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QN216: Question: In the context of mergers and amalgamations, what does “amalgamation” refer to? Answer:a) The process of two or more companies combining to form a new company
a) The process of two or more companies combining to form a new company
b) The process of one company acquiring another company
c) The process of selling assets to another company
d) The process of liquidating a company
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QN217: Question: What is the primary purpose of MCA21, the online portal introduced by the Ministry of Corporate Affairs in India? Answer:d) All of the above
a) Filing annual returns of companies
b) Registering new companies
c) Monitoring corporate governance practices
d) All of the above
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QN218: Question: What is the primary objective of SEBI (Securities and Exchange Board of India)? Answer:a) Protecting the interests of investors in securities markets
a) Protecting the interests of investors in securities markets
b) Regulating the functioning of mutual funds
c) Promoting mergers and acquisitions in the corporate sector
d) Enforcing labor laws in the corporate sector
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QN219: Question: Which of the following is a duty of directors in a company? Answer:d) Maintaining accurate financial records
a) Maximizing shareholder wealth
b) Minimizing employee benefits
c) Engaging in insider trading
d) Maintaining accurate financial records
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QN220: Question: What is the maximum number of members allowed in a private company in India? Answer:c) 200
a) 50
b) 100
c) 200
d) No limit
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QN221: Question: During a company meeting, the term “quorum” refers to: Answer:b) The number of shareholders present
a) The number of directors present
b) The number of shareholders present
c) The number of agenda items discussed
d) The number of votes required for a decision
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QN222: Question: Which of the following is an example of a winding-up method for a company? Answer:a) Voluntary liquidation
a) Voluntary liquidation
b) Forced amalgamation
c) Hostile takeover
d) Capital reduction
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QN223: Question: What is the purpose of corporate governance in a company? Answer: a) Ensuring compliance with legal and regulatory requirements
a) Ensuring compliance with legal and regulatory requirements
b) Maximizing shareholder profits at all costs
c) Expanding the company’s market share
d) Eliminating competition in the industry
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QN224: Question: Who has the ultimate authority to approve a merger between two companies? Answer: b) The shareholders of each company
a) The board of directors of each company
b) The shareholders of each company
c) The government regulatory authorities
d) The CEO of each company
Answer
QN225: Question: Which of the following is a function of the National Company Law Tribunal (NCLT)? Answer: a) Adjudicating disputes between companies and shareholders
a) Adjudicating disputes between companies and shareholders
b) Monitoring stock market activities
c) Issuing licenses for new companies
d) Setting accounting standards for companies
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QN226: Question: What is the liability of a director in a limited liability company? Answer: b) Limited liability to the extent of their investment
a) Unlimited liability
b) Limited liability to the extent of their investment
c) Joint liability with other directors
d) Liability only in case of fraud or negligence
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QN227: Question: Which document contains the rules and regulations for the internal management of a company? Answer: b) Articles of Association
a) Memorandum of Association
b) Articles of Association
c) Certificate of Incorporation
d) Prospectus
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QN228: Question: Under the Companies Act, what percentage of profits should a company set aside for dividend distribution? Answer: d) There is no fixed percentage
a) 10%
b) 20%
c) 30%
d) There is no fixed percentage
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QN229: Question: What is the primary purpose of conducting a company’s annual general meeting (AGM)? Answer: c) To approve financial statements
a) To elect new directors
b) To discuss mergers and acquisitions
c) To approve financial statements
d) To announce employee bonuses
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QN230: Question: Which regulatory authority in India is responsible for regulating securities markets? Answer: a) SEBI
a) SEBI
b) RBI
c) IRDAI
d) PFRDA
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QN231: Question: What is the duration of a non-rotational director’s term in a company? Answer: c) 3 years
a) 1 year
b) 2 years
c) 3 years
d) 5 years
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QN232: Question: Which of the following is not a characteristic of a public limited company? Answer: c) Minimum number of members required
a) Limited liability of shareholders
b) Free transferability of shares
c) Minimum number of members required
d) Ability to raise capital from the public
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QN233: Question: What is the purpose of an extraordinary general meeting (EGM) in a company? Answer: b) To resolve urgent issues that cannot wait until the next AGM
a) To discuss routine matters
b) To resolve urgent issues that cannot wait until the next AGM
c) To elect the board of directors
d) To approve dividend payments
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QN234: According to the Consumer Protection Act 1986, who can file a complaint? Answer: c) Individuals and companies
a) Only individuals
b) Only companies
c) Individuals and companies
d) Government agencies
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QN235: The Consumer Protection Act 1986 covers which type of goods and services? Answer: c) Both essential and luxury goods and services
a) Only essential goods and services
b) Only luxury goods and services
c) Both essential and luxury goods and services
d) None of the above
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QN236: The Consumer Protection Act 1986 provides protection against unfair trade practices. Which of the following is an example of an unfair trade practice? Answer: c) Selling expired or adulterated goods
a) Offering discounts on products
b) Providing accurate product information
c) Selling expired or adulterated goods
d) Offering good customer service
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QN237: Which forum is responsible for hearing consumer complaints involving compensation claims up to 20 lakhs? Answer: a) District Consumer Disputes Redressal Commission
a) District Consumer Disputes Redressal Commission
b) State Consumer Disputes Redressal Commission
c) National Consumer Disputes Redressal Commission
d) Consumer Protection Council
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QN238: Under the Consumer Protection Act 1986, what is the maximum time limit for the disposal of complaints? Answer: c) 90 days
a) 30 days
b) 60 days
c) 90 days
d) 120 days
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QN239: What is the penalty for a manufacturer who fails to comply with the orders of the Consumer Disputes Redressal Forum? Answer: d) Fine up to Rs. 1,00,000
a) Fine up to Rs. 10,000
b) Fine up to Rs. 25,000
c) Fine up to Rs. 50,000
d) Fine up to Rs. 1,00,000
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QN240: Which of the following is a right provided to consumers under the Consumer Protection Act 1986? Answer: c) Right to be informed about the quality, quantity, and price of goods
a) Right to free healthcare
b) Right to free education
c) Right to be informed about the quality, quantity, and price of goods
d) Right to vote in elections
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