1) In JPYINR, INR is the base currency - True or False ?

A) True

B) False

2) In the currency derivative segment of a recognized exchange, pay-in and payout of the mark-to-market
settlement are effected on___________.

A) the day following the trade day

B) expiry of contract

C)the trade day itself

D) two days after the trade day

3) Every derivative contract should have ____________.

A) to be traded on a recognised exchange

B)an underlying

C)good volumes to be traded regularly

D)3 months or more contract period

4) The interest rate of UK is lower than India. As per the concept of Interest Rate Parity the future
currency price of GBP will be __________ to INR.

A)At a discount

B)At Par

C)At a premium

5)The total number of outstanding contracts in the future market at any point of time is called the
__________.

A)Outstanding Status

B)Open Interest
C)Outstanding Position

D)Open position

6)A trader buys two April USDINR contract which cost him Rs 104000. The RBI reference rate for final
settlement is fixed at 52.30. How much profit / loss did he make ?

A)Profit 600

B)Loss 600

C)Profit 60

D)Loss 60

7)The first ever financial future was Stock Derivative future - True or False ?

A)True

B)False

8)A trader buys a USDINR call option at strike of 57.50 and pays a premium of INR 0.60. What is the
break even point for this trade ?

A)56.90

B)57.50

C)58.10

D)58.35

9)Mr. Shah is expecting a remittance of USD 10,000 after two months. To safeguard himself against
currency fluctuations he should ____________.

A)Sell 10,000 contracts of USDINR futures

B)Buy 10,000 contracts of USDINR futures

C)Buy 10 contracts of USDINR futures

D)Sell 10 contracts of USDINR futures

10)The number of USDINR option contracts which can be made available for trading at a given time are
_____ .

A)3

B)4

C)6

D)9

11)If a trader expects INR to depreciate against the USD, he will sell USDINR - True or False ?

A)True

B)False

12) Unlike Equity markets, where there are daily price bands for various stocks, there are no daily price
bands applicable for currency futures contracts - True or False ?

A)True

B)False

13) The participants in foreign exchange market are _____________.

A)Investors

B)Arbitrageurs

C)Hedgers

D)All of the above

14) What will be the Settlement Date for JPYINR currency future contracts for the month of September
2012 if the last working day ie. 30th September falls on a Monday ?

A)27th September
B)28th September

C)29th September

D)30th September

15)The main basic accounting heads to be maintained by any market participant for maintaining
currency futures accounts are Initial margin - currency futures and Mark to market - currency futures -
True or False ?

A)False

B)True

16) The one year interest rate in USD is 2 % and is 9 % in India. Assume the spot rate is 60 and the one
year future price is 62.50. If the interest rate gap between US and India widens and other things remain
the same, what will be the one year future price ?

A)Same as 62.50

B)Higher than 62.50

C)Lower than 62.50

17)As per the Foreign Exchange Management Act an 'AD Category 1' bank should have a minimum
networth of Rs _______ to become a Trading and Clearing Member of currency futures segment at a
recognised stock exchange.

Rs 100 crores

Rs 200 crores

Rs 400 crores

Rs 500 crores

18) A textile exporter from India hedges its receivables using exchange traded currency options. It buys
100 lots of USDINR one month put of strike price 60 at a premium of 30 paise per contract. After a few
days, the exporter decided to cancel the put option and at that time spot was 59.50 and the price
quoted for one month option of strike 60 was 18/19 paise. How much Profit / Loss did he make in this
transaction ?

A)10,000

B)-10,000

C)12,000

D)- 12,000

19) As per the Foreign Exchange Management Act an 'AD Category 1' bank can have a minimum capital
adequacy (CAR) ratio _____ % to become a Trading and Clearing Member of currency futures segment at
a recognised stock exchange.

A)8%

B)10%

C)16%

D)20%

20) Brokers should promptly issue contract notes to his clients and clients of his sub brokers - True or
False ?

A)True

B)False