LIST OF ATTEMPTED QUESTIONS AND ANSWERS
Multiple Choice Single Answer
Question The historical growth rate and the past earnings of a firm
are used in valuing :-
Correct Answer Stable firms, but not appropriate for high growth
firms
Your Answer Stable firms, but not appropriate for high growth firms
Select The Blank
Question The 8% taxable savings bonds are repayable after ________
years.
Correct Answer 6
Your Answer 6
Multiple Choice Single Answer
Question Mr. Tiwari is expecting to receive Rs.25,000/- at the end of
10 years. He wanted to know what is the present value of this amount, if
the rate of interest is 10% p.a:-
Correct Answer Rs. 9639/-
Your Answer Rs. 9639/-
Select The Blank
Question ________ is due to the fact that a borrower may not pay
interest and/or principal on time.
Correct Answer Default risk
Your Answer Default risk
Multiple Choice Single Answer
Question Which year marked increase in growth rate?
Correct Answer 2003 -04
Your Answer 2003 -04
Select The Blank
Question Security analysis serves the investment decision maker by
identifying ________securities.
Correct Answer Under priced
Your Answer Under priced
Multiple Choice Multiple Answer
Question The Peer group of Bharat Forge consists of which all
companies?
Correct Answer Am forge industries , Kalyani Forge , EL Forge
Your Answer Am forge industries , Kalyani Forge , EL Forge
Multiple Choice Multiple Answer
Question The features of bond are :-
Correct Answer Collateral , Call provision , Sinking fund and
protective covenants
Your Answer Collateral , Call provision , Sinking fund and protective
covenants
Match The Following
Question Correct Answer Your Answer
Equity shares High risk High risk
Government Securities No risk No risk
Bank Deposits Low risk Low risk
Mutual Funds Average risk Average risk
Multiple Choice Multiple Answer
Question What are the important macro economic indicators?
Correct Answer Price Conditions , Monsoons , GNP growth rate
Your Answer GNP growth rate , Price Conditions , Monsoons
Select The Blank
Question Debentures rated as "A" are judged to offer ________ of
timely payment of interest and principal.
Correct Answer Adequate safety
Your Answer Adequate safety
Multiple Choice Single Answer
Question What are primary trends?
Correct Answer Reflection of investor's attitudes towards unfolding
fundamentals in the business cycle
Your Answer Reflection of investor's attitudes towards unfolding
fundamentals in the business cycle
True/False
Question Bonds and Debentures represent long term debt instruments.
Correct Answer False
Your Answer False
True/False
Question The returns of sector specific funds are solely dependant on
the performance of the respective sectors / industries.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question The average investor in the market is driven more by
emotions than by rational analysis is a rule of :-
Correct Answer Technical analysis
Your Answer Technical analysis
Multiple Choice Multiple Answer
Question The firm issuing bonds operating sinking fund and
repurchases bonds either :-
Correct Answer Calling in a certain number of bonds by lot , Buying
bonds in the open market , Buying bonds issued to banks and financial
institutions
Your Answer Buying bonds issued to banks and financial institutions ,
Calling in a certain number of bonds by lot , Buying bonds in the open
market
True/False
Question The Asset management company of the mutual fund must have
50% independent directors.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question What is an open ended fund or scheme?
Correct Answer Which is available for subscription and repurchase on
a continuous basis
Your Answer Which is available for subscription and repurchase on a
continuous basis
True/False
Question A price rise accompanied by expanding volume denotes a
potential trend reversal.
Correct Answer False
Your Answer False
Multiple Choice Multiple Answer
Question The Two-Stage dividend discount model is best suited for the
firms that are :-
Correct Answer In high growth rate phase , Expecting to maintain the
growth rate phase steadily for a specific time period , Sources of high
growth are expected to disappear after specific period of time
Your Answer In high growth rate phase , Expecting to maintain the
growth rate phase steadily for a specific time period , Sources of high
growth are expected to disappear after specific period of time
Multiple Choice Single Answer
Question If the price of a share at the beginning of the year was
Rs.70/-, dividend received during the year was Rs.5/-per share and the
price at the end is Rs.79/-. What is the rate of return?
Correct Answer 0.2
Your Answer 0.2
Multiple Choice Multiple Answer
Question If option is given to you to receive Rs.1,000/- today or
after one year, you will choose to receive it today because :-
Correct Answer You can use the amount to generate returns over the
next one year , The purchasing power of Rs.1,000/- today is more than
what it will be one year from now , There is an element of uncertainty
associated with the future receipt
Your Answer You can use the amount to generate returns over the next
one year , The purchasing power of Rs.1,000/- today is more than what it
will be one year from now , There is an element of uncertainty associated
with the future receipt
True/False
Question Investment in gilt edged securities carry a higher element
of risk.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question What is the percentage of variation the market and industry
influence account for?
Correct Answer 2/3rd
Your Answer 2/3rd
Multiple Choice Multiple Answer
Question The investor in bonds receives income from :-
Correct Answer Interest payments at coupon rates , Capital gain/loss
arising out of the sale of the bond , Redemption of the bond of the
issuer at a contracted value
Your Answer Interest payments at coupon rates , Capital gain/loss
arising out of the sale of the bond , Redemption of the bond of the
issuer at a contracted value
True/False
Question A higher value of current ratio indicates a better short
term solvency of the firm.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question Debt instruments that have a maturity period of one year or
less are called as:-
Correct Answer Money market instruments
Your Answer Short term debt instruments
Multiple Choice Single Answer
Question When was the first mutual fund set up?
Correct Answer 1963
Your Answer 1963
Select The Blank
Question ________ measures the efficiency of credit management.
Correct Answer Average collection period
Your Answer Average collection period
True/False
Question A share certificate indicates that the investor owns a
certain number of shares.
Correct Answer True
Your Answer True
Select The Blank
Question ________ take long or short positions only with the
intention of making profits by getting out of the market when conditions
favor them.
Correct Answer Speculators
Your Answer Speculators
Multiple Choice Multiple Answer
Question Which ratios are commonly used?
Correct Answer Debt equity ratio , Interest coverage ratios , Debt
service coverage ratios
Your Answer Debt equity ratio , Interest coverage ratios , Debt
service coverage ratios
Select The Blank
Question The ________ phase is characterized by resistance area and
support level.
Correct Answer Transition
Your Answer Transition
True/False
Question Sensex is the index of Calcutta Stock Exchange.
Correct Answer False
Your Answer False
Select The Blank
Question When a debenture is sold to the general public a ________ is
appointed.
Correct Answer Trustee
Your Answer Trustee
Multiple Choice Single Answer
Question Which market is affected with the improving and higher
growth rate in economy?
Correct Answer Stock market
Your Answer Stock market
Multiple Choice Multiple Answer
Question To measure the movement of stocks in the market which
indices were constructed by Dow?
Correct Answer Dow Jones industrial Average , Dow Jones
Transportation Average
Your Answer Dow Jones industrial Average , Dow Jones Transportation
Average
Multiple Choice Multiple Answer
Question What are the features of line charts?
Correct Answer It connects closing prices from one period to the next
, It is ideal for securities with no high or low price data
Your Answer It connects closing prices from one period to the next ,
It is ideal for securities with no high or low price data
Multiple Choice Multiple Answer
Question What are the features of post office monthly income scheme?
Correct Answer Rate of return is 8 % , Interest payable monthly ,
Investor earns bonus of 10% on completion of term
Your Answer Rate of return is 8 % , Interest payable monthly ,
Investor earns bonus of 10% on completion of term
Multiple Choice Single Answer
Question In India we have index futures contracts based on :-
Correct Answer S&P CNX Nifty and the BSE sensex
Your Answer S&P CNX Nifty and the BSE sensex
Select The Blank
Question ________ deal in futures to offset a pre-existing risk.
Correct Answer Hedger
Your Answer Hedger
Multiple Choice Multiple Answer
Question What are the different types of profitability ratios?
Correct Answer Gross profit margin ratio , Earnings power , Return on
equity
Your Answer Gross profit margin ratio , Earnings power , Return on
equity
True/False
Question A rise in interest rates will push the market prises of
outstanding bonds where as a fall in interest rates will depress the
market prices down.
Correct Answer False
Your Answer False
Select The Blank
Question A ________ rally for stocks generally takes place because of
an improved outlook for business conditions over what was anticipated.
Correct Answer Bear market
Your Answer Bear market
True/False
Question Following a decline, heavy volume with little price change
is indicative of accumulation and is normally a bearish factor.
Correct Answer False
Your Answer False
Match The Following
Question Correct Answer Your Answer
Gross profit margin Indicates the margin available after meeting the
manufacturing expenses Valuation ratio
ROE Measure the profitability of equity funds Measures the profitability
of debt funds
Earnings power Measure the profitability of operations without
considering the influence of financial structure and tax rate Indicates
the margin available after meeting the manufacturing expenses
Net profit margin Ratio if net profit to sales Measure the profitability
of operations without considering the influence of financial structure
and tax rate
Select The Blank
Question The Derivative market is divided into Future market and
________ market.
Correct Answer Options
Your Answer Options
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