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Total Questions 32 = 14 (1 marker ) + 18 (2 marker)
Total Marks = 50
Time : Approx 32 Minutes
Negative Marking – 1/4th
Q.1) To successfully achieve the targets, which factors need to be balanced properly
according to action centered theory?
[1] Communication, motivation and compensation
[2] Policy, performance and reward
[3] Goal, resource and behavior
[4] Task, team and individual
Q.3) A process that integrates work content, the rewards, and the qualifications
required for each job in a way that meets the needs of organization as well as
employees is known as _____
[1] Job evaluation
[2] Job design
[3] Job specification
[4] Job description
Q.4) Reliance Industries has made a move to invest in the telecom sector project,
whose estimated Profitability Index comes out to 1.30. What does this data signify?
[1] The NPV is less than 0
[2] The payback period is more than 1.3 years
[3] The project returns Rs 1.30 for every Rs 1 invested in that project
[4] That the IRR is 1.30 times that of hurdle rate
[5] That the IRR is 1.30 times that of hurdle rate
Q.6 Neeraj is a manager who shows a good confidence and trust on his employees but still
keeps control on decision making power. He usually invites ideas and opinions from
employees and try to make constructive use of them. This makes subordinates rather feel
free to discuss things about their work and job with Neeraj. Which leadership style is
reflected by Neeraj according to Likert’s theory of leadership?
[1] Exploitative authoritative
[2] Benevolent authoritative
[3] Consultative
[4] Democratic
Q.9) Suppose a bank is holding a portfolio of long-maturity assets, and has financed it
with short-maturity liabilities. Which of the following risks is most obvious?
[1] Refinancing Risk
[2] Counterparty Risk
[3] Operational Risk
[4] Default Risk
[5] Sovereign Risk
Q.10) In the month of May 2019, a High Level Committee on Deepening of Digital
Payments had submitted its report to the RBI. Which of the following persons was the
head of the committee?
[1] H.R. Khan
[2] Nandan Nilekani
[3] Kishore Sansi
[4] Aruna Sharma
[5] Sanjay Jain
Q.11) Most of the employees in accounts department were not satisfied with the promotion
of Ram as the accounts manager. They think that Ram was undoubtedly an expert in the
taxation work but he was not good in any other activity which also forms the part of
promotion criteria. In spite of having few absences, the management has given him high
rating in all other works too just because he performed well in the taxation area. What is the
error in performance appraisal system here?
[1] Central tendency
[2] Halo effect
[3] Horn effect
[4] Spillover effect
Q.12) People with which of the following need will focus more on collaboration over
competition?
[1] Need for achievement
[2] Need for power
[3] Need for affiliation
[4] None of the above
Q.14) Mahesh opened a South Indian restaurant where he employed two chefs to prepare 5 types of
dishes. With increased number of customers, chefs find it difficult to complete the order in time as
they have to do all types of work from taking orders, prepare them till serving them. Mahesh
recognized this and employed three new persons to make the work easier and faster. Specified tasks
were assigned to them like one will only take orders, other will focus only to prepare the dish and next
is only to serve the food to customers. Which technique was used by Mahesh at workplace?
[1] Job rotation
[2] Job enrichment
[3] Job simplification
[4] Job enlargement
Q.17) Which of the following section confers power upon RBI under Banking
regulation act 1949, to direct banking companies to resolve specific stressed assets
by initiating insolvency resolution process when required?
[1] Section 24
[2] Section 18
[3] Section 35AA
[4] Section 20
[5] Section 56
1. SWOT
2. PESTEL
3. Porter 5 forces
4. BCG Matrix
Q.22) Keeping in mind the managerial grid, choose the correct pair from the
following:
[1] a 2, b 4, c 3 and d 1
[2] a 3, b 4, c 1 and d 2
[3] a 2, b 3, c 4 and d 1
[4] a 1, b 3, c 4 and d 2
Q.30) A collateralized borrowing and lending obligation (CBLO) is a money market instrument that
represents an obligation between a borrower and a lender as to the terms and conditions of a loan.
Which of the following statement is incorrect regarding CBLO instrument in India?
[1] Operated by the Clearing Corporation of India Ltd. (CCIL) and Reserve Bank of India (RBI)
[2] Eligible securities for collateral include Central Government securities, such as Treasury Bills
[3] Types of financial institutions eligible for CBLO membership include insurance firms, mutual funds,
nationalized banks, private banks, pension funds, and private dealers
[4] In order to borrow, members must open a Constituent SGL (CSGL) account with the CCIL which will
be used to deposit the collateral
[5] None of the above
Q.31) According to the RBI Annual Report 2018-19, the Gross Fiscal Deficit (GFD)
target of 3% will be achieved by which of the following years?
[1] 2020-21
[2] 2021-22
[3] 2022-23
[4] 2023-24
[5] 2024-25
30 to 34 – Good Performance
38 + - Excellent Performance
Marks: 1
Q.1) To successfully achieve the targets, which factors need to be balanced properly
according to action centred theory?
[1] Communication, motivation and compensation
[2] Policy, performance and reward
[3] Goal, resource and behavior
[4] Task, team and individual
Answer: [4] Task, team and individual
As per action centered theory of leadership, task, team and individual are the three
main factors that need to be balanced properly to achieve the targets.
This theory suggest that task is very important. Without it, there is no reason to have
a team made up of individuals. Any given team is made of various individuals
possessing different skills and experience, so it is up to the leader to extract best
possible performance from each of them. Forgetting about people within the team is
the most common mistake made by managers. Individuals have varying desires, fears,
motivation and experiences. Manager should carefully understand and assess these
things and give coaching and motivation to employees on that basis. So, action will be
performed successfully only when task, team and individual all are considered and
used properly.
The level and nature of the work highly impact the morale and attitude of a worker. If
the employee is expected to perform routine or specialized jobs, he will feel bored
and alienated. As opposite to it, a motivated employee doesn’t care much about it
and continues to give his best in whatever job he is performing.
Q.3) A process that integrates work content, the rewards, and the qualifications
required for each job in a way that meets the needs of organization as well as
employees is known as _____
[1] Job evaluation
[2] Job design
[3] Job specification
[4] Job description
Answer: [2] Job design
Job design is a core function of Human resource that consider each and every aspect
of job in order to meet both organisational and employee’s goals.
Q.4) Reliance Industries has made a move to invest in the telecom sector project,
whose estimated Profitability Index comes out to 1.30. What does this data signify?
[1] The NPV is less than 0
[2] The payback period is more than 1.3 years
[3] The project returns Rs 1.30 for every Rs 1 invested in that project
[4] That the IRR is 1.30 times that of hurdle rate
[5] That the IRR is 1.30 times that of hurdle rate
Answer: 3
• It is a method to calculate,
• Profitability of a proposed
corporate project,
• By comparing the cash flows
created by the project,
• To the capital investments
required for the project.
Simply, it evaluates the
investments. It is also known as
cost-benefit ratio or capital
rationing.
Marks: 1
The price-earnings ratio (P/E ratio) is the ratio for valuing a company that measures its
current share price relative to its per-share earnings. P/E ratio of 10 indicates
that investors in the stock are willing to pay Rs.10 per share for every Rs.1 of earnings
(profits) per share that the company generates. Generally Low P/E ratio means that
one must pay less price for the profits generated by the company and High P/E ratio
means that one must pay more price for the profits generated by the company. But
High P/E ratio does not necessarily means that stock is expensive and one should not
invest. High P/E ratio can also mean that people are expecting huge growth in
earnings in the coming years
Q.6 Neeraj is a manager who shows a good confidence and trust on his employees
but still keeps control on decision making power. He usually invites ideas and
opinions from employees and try to make constructive use of them. This makes
subordinates rather feel free to discuss things about their work and job with Neeraj.
Which leadership style is reflected by Neeraj according to Likert’s theory of
leadership?
[1] Exploitative authoritative
[2] Benevolent authoritative
[3] Consultative
[4] Democratic
Answer: [3] Consultative
Q.8) _________ theory assumes that calmness pays when the workers are angry or
on strikes and this calmness can be brought by welfare measures. Workers are like
children who are intelligent, but not fully so.
[1] Paternalistic theory
[2] Public relations theory
[3] Placating theory
[4] Philanthropic theory
Answer : [3] Placating theory
The Placating theory of labour welfare has placed the above opinion.
Q.9) Suppose a bank is holding a portfolio of long-maturity assets, and has financed it
with short-maturity liabilities. Which of the following risks is most obvious?
[1] Refinancing Risk
[2] Counterparty Risk
[3] Operational Risk
[4] Default Risk
[5] Sovereign Risk
Answer: [1] Refinancing Risk
"Refinancing" risk is one type of "interest rate risk." The short-term securities will
come due—and require "refinancing"—before the assets mature. Refinancing risk is
the possibility that a borrower cannot refinance by borrowing to repay existing debt.
Many types of commercial lending incorporate balloon payments at the point of final
maturity; often, the intention or assumption is that the borrower will take out a new
loan to pay the existing lenders. Most large corporations and banks face this risk to
some degree, as they may constantly borrow and repay loans. Refinancing risk
increases in periods of rising interest rates, when the borrower may not have
sufficient income to afford the higher interest rate on a new loan. Most commercial
banks provide long term loans, and fund this operation by taking shorter term
deposits. In general, refinancing risk is only considered to be substantial for banks in
cases of financial crisis, when borrowing funds, such as inter-bank deposits, may be
extremely difficult.
Q.11) Most of the employees in accounts department were not satisfied with the
promotion of Ram as the accounts manager. They think that Ram was undoubtedly
an expert in the taxation work but he was not good in any other activity which also
forms the part of promotion criteria. In spite of having few absences, the
management has given him high rating in all other works too just because he
performed well in the taxation area. What is the error in performance appraisal
system here?
[1] Central tendency
[2] Halo effect
[3] Horn effect
[4] Spillover effect
Answer: [2] Halo effect
Q.12) People with which of the following need will focus more on collaboration over
competition?
[1] Need for achievement
[2] Need for power
[3] Need for affiliation
[4] None of the above
Answer: [3] Need for affiliation
People with need for affiliation will focus more on building relationship with people,
team work, and prefer collaboration over competition in their life.
At upper levels in the organization Administration is more of the work for the
employees
Q.14) Mahesh opened a South Indian restaurant where he employed two chefs to
prepare 5 types of dishes. With increased number of customers, chefs find it difficult
to complete the order in time as they have to do all types of work from taking orders,
prepare them till serving them. Mahesh recognized this and employed three new
persons to make the work easier and faster. Specified tasks were assigned to them
like one will only take orders, other will focus only to prepare the dish and next is only
to serve the food to customers. Which technique was used by Mahesh at workplace?
[1] Job rotation
[2] Job enrichment
[3] Job simplification
[4] Job enlargement
Answer : [3] Job simplification
Mahesh has done job simplification to make the work easier and faster.
Job simplification is a method whereby jobs are divided into smaller components
and subsequently assigned to workers as whole jobs. It helps in making the work
easier and completed fast. Also, not much trained people are required. A low skilled
person can also perform well by learning it during work only.
Q.17) Which of the following section confers power upon RBI under Banking
regulation act 1949, to direct banking companies to resolve specific stressed assets
by initiating insolvency resolution process when required?
[1] Section 24
[2] Section 18
[3] Section 35AA
[4] Section 20
[5] Section 56
Answer: [3] Section 35AA
Q.18) Recently (August 2019) Union Cabinet approves eight amendments to the
Insolvency and Bankruptcy Code (IBC) that will enforce a ______ timeline for the
insolvency resolution process.
[1] 270 days
[2] 181 days
[3] 365 days
[4] 546 days
[5] 330 days
Answer:[5] 330 days
1. The Union Cabinet cleared major changes to the bankruptcy law that will enforce
a strict 330-day timeline for the insolvency resolution process, including any legal
challenges, and uphold secured creditors’ priority right on the sale or liquidation
proceeds of bankrupt companies.
2. The eight amendments to the Insolvency and Bankruptcy Code (IBC) will also aid
decision-making in the case of bankrupt entities such as property developers, which
have a large number of creditors, including homebuyers.
Slippage ratio is defined as total fresh accretion of NPAs during the year to total
standard assets at the beginning of the year. This ratio is significant as it indicates
proportion of fresh NPA’s formed in a particular year out of total standard assets of
the bank. Hence, the word ‘Slippage’ is used to signify its essence. This is one of the
important financial ratios to gauge a Bank’s financials.
1. SWOT
2. PESTEL
3. Porter 5 forces
4. BCG Matrix
Answer is 2
Q.22) Keeping in mind the managerial grid, choose the correct pair from the
following:
[1] a 2, b 4, c 3 and d 1
[2] a 3, b 4, c 1 and d 2
[3] a 2, b 3, c 4 and d 1
[4] a 1, b 3, c 4 and d 2
Answer: [3] a 2, b 3, c 4 and d 1
Q.24) Which of the following is incorrect about Reserve Bank of India (Prudential
Framework for Resolution of Stressed Assets) Directions 2019?
[1] The new norm makes it lenders choice to go for legal proceedings and insolvency
or not.
[2] As per the new Prudential Framework, the lenders need to take resolution action
on the first day of default.
[3] As per the new Prudential Framework, the RBI will be giving instructions to banks
on specific defaults.
[4] All the statements are true
[5] None of the statements are true
Answer:[2] As per the new Prudential Framework, the lenders need to take
resolution action on the first day of default.
1. The lenders need not take resolution action on the first day of default. Rather,
they have to make plans on the first thirty periods of default to undertake the
resolution of the stressed assets.
2. The new norm makes it lenders choice to go for legal proceedings and insolvency
or not.
3. As per the new Prudential Framework, the RBI will be giving instructions to
banks on specific defaults.
1. Reserve Bank of India through its recent circular , has increased loan exposure
limit of banks to a single NBFC (excluding gold loan companies) from 15 per
cent to 20 per cent of its capital base.
2. According to the RBI’s circular on 'Large Exposures Framework (LEF)', banks'
exposure to a single non-banking financial company (NBFC) is restricted to 15
per cent of their available eligible capital base, while general single counter-
party exposure limit is 20 per cent, which can be extended to 25 per cent by
banks' boards under exceptional circumstances.
Q.26) Recently (July 2019) it has been announced that Credit Guarantee
Enhancement Corporation (CGEC) will be set up in 2019-20. Which of the following
will be regulated CGEC?
[1] RBI
[2] SEBI
[3] NABARD
[4] SIDBI
[5] Ministry of Finance
Answer : [1] RBI
Q.27) RBI had set up an internal working group to improve MCLR transmission which
recommended linking bank lending rates to market determined external benchmark
rate. The group was headed by
[1] S. S. Mundra
[2] Chandan Sinha
[3] Janak Raj
[4] R. Gandhi
[5] N. S. Vishwanathan
Answer : [3] Janak Raj
RBI had created working group to review the working of MCLR system which was
headed by Janak Raj
3rd statement is false because the clearer is the delegation of Authority, it is less
work for the manager and larger can be the span of Control
Q.29) According to Fugitive Economic Offenders Act, 2018, Central Government has
advised PSBs to obtain certified copy of the passport of promoters/directors and
other authorized signatories of companies availing of loan facilities of more than
______.
[1] Rs 25 crore
[2] Rs 50 crore
[3] Rs 10 crore
[4] Rs 100 crore
[5] Rs 500 crore
Answer : [2] Rs 50 crore
Q.30) A collateralized borrowing and lending obligation (CBLO) is a money market instrument
that represents an obligation between a borrower and a lender as to the terms and
conditions of a loan. Which of the following statement is incorrect regarding CBLO instrument
in India?
[1] Operated by the Clearing Corporation of India Ltd. (CCIL) and Reserve Bank of India (RBI)
[2] Eligible securities for collateral include Central Government securities, such as Treasury
Bills
[3] Types of financial institutions eligible for CBLO membership include insurance
firms, mutual funds, nationalized banks, private banks, pension funds, and private dealers
[4] In order to borrow, members must open a Constituent SGL (CSGL) account with the CCIL
which will be used to deposit the collateral
[5] None of the above
Answer : [5] None of the above
Collateralized borrowing and lending obligations (CBLOs) is operated by the Clearing Corporation of
India Ltd. (CCIL) and Reserve Bank of India (RBI). The CBLO is a money market segment where short-
term loans can be secured by financial institutions in order to cover their transactions. To gain access
to these funds, the financial institution must provide eligible securities as collateral. Eligible
securities for collateral include Central Government securities, such as Treasury Bills, with at least six
months left to the maturity date.
Since the repayment of loans is guaranteed by the CCIL, all borrowings are fully collateralized. The
collateral provides a safeguard against default risk by the borrower or lender’s failure to make funds
available to the borrower. The required value of collateral must be deposited and held in the custody
of the CCIL. After the deposit has been received, the CCIL facilitates trades by matching borrowing
and lending orders submitted by its members. Members of the CCIL comprise of institutions with
little to no access to the interbank call money market in India. Types of financial institutions eligible
for CBLO membership include insurance firms, mutual funds, nationalized banks, private
banks, pension funds, and private dealers. In order to borrow, members must open a Constituent SGL
(CSGL) account with the CCIL which will be used to deposit the collateral.
The CBLO works like a bond in that the lender buys the CBLO, and a borrower sells
the money market instrument with interest. The CBLO facilitates borrowing and
lending for various maturities, from overnight to a maximum of one year, in a fully
collateralized environment.
Q.31) According to the RBI Annual Report 2018-19, the Gross Fiscal Deficit (GFD)
target of 3% will be achieved by which of the following years?
[1] 2020-21
[2] 2021-22
[3] 2022-23
[4] 2023-24
[5] 2024-25
Answer : [1] 2020-21
1. According to the RBI Annual Report 2018-19, the Gross Fiscal Deficit (GFD)
target of 3% will be achieved by 2020-21 in pursuance of the Fiscal
Responsibility and Budget Management (FRBM) Act, 2003.
2. The aim is to attain a central government debt to GDP ratio of 40 per cent and a
general government debt to GDP ratio of 60 per cent by 2024-25.
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