Management of Financial Services Set 2

QN1. Unregistered NBFC’s are still operating in the Indian economy

Answer

Answer: Yes

QN2. A NBFC should not lend more than

a. 10%

b. 15%

c. 20%

d. 25%

Answer

Answer: b. 15%

QN3. Which NBFC recommendations were given in 1996

a. Vaghul Committee

b. Narsimhan Committee

c. Khanna Group

d. Shah Committee

Answer

Answer: C. Khanna Group

QN4. Factoring (without recourse) means if the debtor fails to pay the dues the losses

are absorbed by the client

Answer

Answer: Yes

QN5. Factoring and Bill discounting are just the same service with different names

Answer

Answer: Yes

QN6. Forfaiting and factoring affect the financial statements

Answer

Answer: Yes

QN7. Venture capital is a debt related investment.

Answer

Answer: False

QN8. Venture Capital just technology financing

Answer

Answer: False

QN9. Venture capital has _______ methods of financial analysis

a) One

b) Two

c) Three

d) Four

Answer

Ans b) Two

QN10. SEBI was constituted in

a) 1978

b) 1982

c) 1988

d) 1991

by the Government of India

Answer

Answer: 1988

QN11. After the closure of an issue the compliance report must be sent to SEBI within

a) 15 days

b) 30 days

c) 45 days

d) 60 days

Answer

Answer: a) 15 days

QN12. If a Rights issue is over subscribed the retention of over subscription is not

possible under any circumstances

Answer

Answer: No.

QN13. As per BSE a ” taravaniwala” is a

a) Financier

b) Oddlot Leader

c) Jobber or specialist

d) Floor broker

Answer

Answer: c) Jobber or specialist

QN14. In BSE the specified group consists of :

a) 94 companies

b) 96 companies

c) 100 companies

d) 122 companies

Answer

Answer: c. 100 Companies

QN15. In OTCEI T-days is

a) Wednesday

b) Thursday

c) Friday

d) Saturday

Answer

Answer: d) Saturday

QN16. The first credit rating agency of India was:

a) ICRA

b) CRISIL

c) CARE

d) DCR

Answer

Answer: CRISIL

QN17. Credit Rating along with debt securities is also done for Real estate

Developers/builders, banks, economic, risks, political risks etc.

Answer

Answer: Yes

QN18. NHB works under

a) SEBI

b) Ministry of Finance

c) RBI

d) IDBI

Answer

Answer: c. RBI

QN19. Lease payments are usually made at the start of each period. Thus the first payment is usually made as soon as the lease contract is signed

Answer

Answer: True

QN20. Financial leases provide off-balance sheet financing

Answer

Answer: True

QN21. A financial lease should not be undertaken unless it provides more financing than the equivalent. T/F

Answer

Answer: False

QN22. It makes sense for firms that pay no taxes to lease from firms that do

Answer

Answer: False

QN23. Other things being equal the net tax advantage to leasing increases as nominal rates increase

Answer

Answer: True

State for each of the following pairs of issues which would you expect to involve the lower proportionate underwriting and administrative cost, other things being equal:

QN24. A large issue/ a small issue

Answer

Answer: A Large Issue

QN25. A bond issue/ a common stock issue

Answer

Answer: Bond Issue

QN26. A large negotiated bond issue / a large competitive bond issue.

Answer

Answer: A large negotiated bond issue

QN27. A small private placement of bonds/ small general cash offer of bonds

Answer

Answer: A small private placement of bonds

Besides each of the following issue methods two issuers are listed, choose the one more likely to employee that method

QN28. Rights issue (issue of seasoned stock/issue of unseasoned stock)

Answer

Answer: Issue of seasoned stock

QN29. Competitive general cash officer (bond issue by industrial company/ bond issue by utility holding company)

Answer

Answer: Bond issue by Industrial Company

QN30. Private placement (issue of seasoned stock/ bond issue by industrial company)

Answer

Answer: Bond issue by Industrial Company

QN31. Investors in Mutual Funds obtain returns in the form of dividends, capital gains and appreciation in the value of NAV

Answer

Answer: True

QN32. Close ended Mutual funds have a secondary market available and their prices are determined by demand and supply not NAV.

Answer

Answer: True

QN33. Open ended mutual funds have a fixed capitalization

Answer

Answer: False

QN34. Open ended mutual funds prices are determined by their NAV

Answer

Answer: True

QN35. Custodial services are fund and fee based activities

Answer

Answer: True

QN36. Custodial services are capital intensive and technology driven business: T/F

Answer

Answer: True

QN37. Custodial services fall under RBI :T/F

Answer

Answer: False

QN38. Euro Money = (Euro Currency)+(Euro Deposit): T/F

Answer

Ans True

QN39. Euro money is the money which is regulate in Europe only: T/F

Answer

Answer: False

QN40. Euro loan and Euro bonds are one and the same thing: T/F

Answer

Answer: False