Dr.G.R.

Damodaran College of Science

(Autonomous, affiliated to the Bharathiar University, recognized by the UGC)Re-accredited
at the 'A' Grade Level by the NAAC and ISO 9001:2008 Certified
CRISL rated 'A' (TN) for MBA and MIB Programmes

III B.Com (AM)

(2017-2020)
SIXTH SEMESTER
Elective III - FINANCIAL SERVICES – 613 U1
Multiple Choice Questions.

1. The term Merchant Bank is used in

A. United States
B. United Kingdom
C. America
D. India
ANSWER: B

2. Banks implement the RBI

A. Monetary policies
B. Commercial policies
C. credit policies
D. Both A and B
ANSWER: D

3. which one of the following is not a money market securities?

A. Treasury bills
B. National savings certificate
C. Certificate of deposit
D. Commercial paper
ANSWER: B

4. The early growth of merchant banking in the country is assigned to the

A. FEMA
B. Foreign Exchange Regulation Act, 1973
C. Securities Contracts Act
D. Income-tax Act
ANSWER: B

5. .______ is regarded as the fourth element of the financial system.

A. Financial services
B. Financial markets
C. Financial instruments
D. Financial institutions
ANSWER: A

6. The ______ is the apex organization in the Indian money market

 A. SBI
B. RBI
C. ICICI
D. IDBI
ANSWER: A

7. ___________ are financial assets

A. Bonds
B. Machines
C. Stocks
D. A and C
ANSWER: D

8. CRISIL has been promoted by ____ and _____.

A. .ICICI, UTI
B. IDBI, SBI
C. AXIS, UTI
D. PNB, SBI
ANSWER: A

9. _________is a long term risk capital to finance high technology projects which involve risk but at same time has
strong potential for growth
A. Venture capital
B. hedge finance
C. Merchant banker
D. hire purchaser
ANSWER: A

10. The term _____ is defined as a central location for keeping securities on deposit.
A. Depository
B. .Instrument
C. Institutions
D. None of the above
ANSWER: A

11. Which of the following would be considered a risk-free investment?

A. Gold.
B. Equity in a house.
C. High-grade corporate bonds.
D. Treasury bills.
ANSWER: A

12. __________act as an intermediary to link up the sources of ideas and the sources of fund.
A. Venture capital
B. Merchant banking
C. Leasing
D. None of these.
ANSWER: A

13. Which of the following is not a fee based financial service?

A. Corporate counseling
 B. Lease financing
C. Profit management
D. Issue management
ANSWER: B

14. Financial service companies exclude

A. Commercial banks
B. Insurance companies
C. Sole proprietorship
D. Crepitating agencies.
ANSWER: C

15. Bank deposit refers to

A. The amount of money standing to the credit of a customer of a bank
B. A term used by the Federal Reserve to refer to the total deposits of member banks
C. The amount of money standing to the debit as a customer of a bank
D. All of the above
ANSWER: A

16. As per the RBI's clean note policy writing on a currency note is
A. An offense
B. A crime
C. A punishable offence
D. The notes becomes non-legal tender
ANSWER: C

17. Nationalization of banks aimed at all of the following except

A. Removal of control by a few
B. Provision of control by a few
C. Provision of adequate credit for agriculture, small industry and export units
D. Encouragement of a new class of entrepreneur
ANSWER: B

18. The advance value of LIC policy is linked with

A. Face value
B. Surrender value
C. Paid up value
D. Depending on the age of policy holder
ANSWER: B

19. State Bank of India is a

A. Public Sector Bank
B. Private Sector Bank
C. Joint Sector Bank
D. Non-Nationalised bank
ANSWER: A

20. Dividends are paid________________.

A. monthly.
B. quarterly.
C. semi-annually.
 D. yearly.
ANSWER: D

21. Real Time Gross Settlement (RTGS) is management by

A. State Bank of India
B. Reserve Bank of India
C. Indian Bank Association
D. Government of India
ANSWER: B

22. Relationship of banker with payee of draft

A. Trustee and Beneficiary
B. Drawees and Drawee
C. Licensor and Licensee
D. .Principle and Agent
ANSWER: A

23. SEBI is
A. Regulatory Authority
B. Statutory Authority
C. Both (a) and (b)
D. None of these
ANSWER: C

24. In order to avoid paying income taxes, an investment company must_____________.

A. be classified as a non-profit organization.
B. invest only in municipal bonds.
C. pass on interest, dividends, and capital gains to the stockholders.
D. be registered as a closed-end investment company.
ANSWER: B

25. The most popular type of investment company is a________.

A. unit investment trust.
B. mutual fund.
C. closed-end investment company.
D. real estate investment trust.
ANSWER: A

26. When did the National Bank of Agriculture and Rural Development establish?
A. July, 1982
B. July, 1969.
C. June, 1951
D. June, 1961
ANSWER: A

27. Which is the first credit card facility to be recognized worldwide ?

A. Rupay card
B. Visa card
C. Master card
D. maestro card
ANSWER: B
28. PIN stands for
A. Portable Identification Number
B. Permanent identification Number
C. Personal identification Number
D. None of the above
ANSWER: C

29. The term Smart Money refers to

A. Foreign Currency
B. Internet Banking
C. US Dollars
D. Credit cards
ANSWER: D

30. From which country the concept of Credit card originated ?

A. Russia
B. Germany
C. China
D. USA
ANSWER: D

31. As per RBI guidelines for Credit Card operations the credit card can be issued by
A. Banks only
B. Non bank finance companies
C. Mutual Fund only
D. Bank and Non bank finance companies
ANSWER: D

32. Credit Cards are known as

A. Hard money
B. Easy money
C. Soft money
D. Plastic money
ANSWER: D

33. Which one of the following is a Credit Card Association ?

A. India Card
B. Master Card
C. SBI Card
D. City Banks Cards
ANSWER: B

34. A revolving credit account is a

A. installment loan account.
B. equity account.
C. close-end account
D. open-end account.
ANSWER: D

35. Credit blocking occurs when

 A. when you return merchandise.
B. when lenders are blocked from collecting your credit balance.
C. when you are denied a credit card
D. your line of credit is reduced by the estimated cost of an anticipated purchase.
ANSWER: B

36. smart cards are based in ____ standards

A. SET
B. MIME
C. HTTP
D. TULIP
ANSWER: D

37. Digital signature certificated are issued by

A. central Government
B. State Government
C. certifying authority
D. none of the above
ANSWER: C

38. For which card one has to made advance payment?

A. Smart card
B. Gold card
C. Debit card
D. Credit card
ANSWER: A

39. VAN Stands for

A. varied area network
B. Virtual area network
C. value added network
D. none of the above
ANSWER: C

40. In credit card what is the grace period of payment?

A. 10-15 days
B. 5-20 days
C. 15-45 days
D. 1-2 days
ANSWER: C

41. Who can pass the law for e banking?

A. SBI
B. Parliament
C. RBI
D. Merchant association
ANSWER: C

42. For which card one has to made advance payment

A. credit card
B. Debit card
 C. Smart card
D. Gold card
ANSWER: A

43. PIN in ATM card id of

A. 4 alphabets
B. 2 alphabets and 2 digits
C. 4digits
D. none of the above
ANSWER: C

44. what is E sign act?

A. Electronic sign act
B. Electronic signatures in global and national commerce act
C. Electronic signatures in national and global act
D. none of the above
ANSWER: A

45. SSL is
A. secret sockets layers
B. secured sockets layer
C. symmetric sockets layer
D. none of the above
ANSWER: B

46. A bankers cheque is

A. A local DD
B. an outstation DD
C. an outdated cheque
D. A prorata cheque
ANSWER: A

47. what is the full form of ATM?

A. automatic teller machine
B. advance money transaction
C. any time money
D. accurate teller money
ANSWER: A

48. A debit cards/ ATM cards is a _______ digit numbers

A. 12
B. 13
C. 16
D. 10
ANSWER: C

49. how many numbers are in a CVV code?

A. 1
B. 2
C. 3
D. 4
 ANSWER: C

50. Which is the first bank to introduce credit card in India?

A. Canara Bank
B. Central Bank of India
C. Bank of Baroda
D. ICICI
ANSWER: B

51. Which is the largest public sector bank in India?

A. SBI
B. Central Bank of India
C. Canara Bank
D. Bank of Baroda
ANSWER: A

52. Which is the largest private sector bank in India?

A. AXIS BANK
B. ICICI bank
C. HDFC bank
D. IDBI
ANSWER: B

53. Which is the first bank to introduce ATM in India?

A. HSBC
B. SBI
C. United bank of india
D. ICICI
ANSWER: A

54. What does APR stand for ?

A. annual purchase rate
B. annual percentage rate
C. approximate processing rate
D. approximate payment rotation
ANSWER: B

55. Which bank started the first RRB named Prathama Grameen Bank?
A. Punjab National Bank
B. Syndicate Bank
C. SBI
D. United Bank of India
ANSWER: B

56. Which is the first Indian bank to open branch outside India?
A. Bank of Baroda
B. Bank of India
C. Canara bank
D. SBI
ANSWER: B
57. presently which bank is the largest issuer of credit cards in the country?
A. SBI
B. HDFC
C. ICICI
D. PNB
ANSWER: B

58. Which is the correct description for a credit card?

A. Defers payment indefinitely provided you maintain interest payments
B. Allows us to pay for goods immediately.
C. Defers payment for one month only.
D. Allows us to borrow money at a cheap rate.
ANSWER: B

59. KYC means

A. Know your customer
B. Know your character
C. know your credit
D. none of the above
ANSWER: A

60. bank does not give loan against

A. gold
B. LIC policy
C. lottery ticket
D. NSC
ANSWER: C

61. 100/-Rupee note is signed by

A. prime minister
B. finance minister
C. RBI governor
D. central government
ANSWER: C

62. Highest denomination of currency notes issued by RBI is

A. Rs. 100
B. Rs.500
C. Rs.2000
D. Rs.50
ANSWER: C

63. Life insurance means

A. Insurance of human
B. Insurance of life of human and Cattle
C. Insurance of Life of Machines
D. all the above
ANSWER: A

64. PAN means

A. A kind of utensil
 B. Primary Account Number
C. Permanent Account Number
D. all the above
ANSWER: B

65. Bank Pass Book is

A. Issued by Bank
B. Contains transaction details of Bank account
C. Shows balance in account
D. all the above
ANSWER: B

66. Currency notes are issued by

A. RBI
B. NABARD
C. public sector banks
D. central government
ANSWER: A

67. Coins are issued by

A. Government of India
B. NABARD
C. SBI
D. PUBLIC sector bank
ANSWER: A

68. What is RuPay Debit Card?

A. Domestic debit card
B. Introduced by National Payments Corporation of India
C. Accepted at all ATMs & PoS machines
D. all the above
ANSWER: D

69. Which type of deposits earns higher interest rate?

A. current Account
B. savings account
C. fixed deposit
D. none of the above
ANSWER: C

70. What is validity period of cheque?

A. 4 months from date of issue
B. 3 months from date of issue
C. 1 months from date of issue
D. unlimited
ANSWER: B

71. The Majority shareholder in CRISIL is

A. Standard and Poor
B. Fitch Ratings Inc.
C. Moodys
 D. Dun and Bradstreet
ANSWER: A

72. The headquarter of ONICRA is

A. Mumbai
B. Gurugram
C. Hyderabad
D. Noida
ANSWER: B

73. The headquarters of Investment Information & Credit Rating Agency (ICRA) Limited is located in
A. Mumbai
B. Gurugram
C. Hyderabad
D. Noida
ANSWER: B

74. A Credit Bureau is governed by which of the following act?

A. Securities and Exchange Board of India Act, 1992
B. Reserve Bank of India Act, 1934
C. Credit Information Companies (Regulation) Act of 2005
D. Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999
ANSWER: C

75. Which of the following is Indian first Credit Information Company

A. CRISIL
B. CIBIL
C. SMERA
D. CERSAI
ANSWER: B

76. interest rates for housing finance is

A. fixed
B. floating
C. uncertain
D. both A&B
ANSWER: D

77. What is the full form of CRISIL?

A. Credit Rating Information Services of India Limited
B. Credit Rating Investment Services of India Limited
C. Credit Rating Insight Services of India Limited
D. Credit Rating Indian Services for Investment and Liability
ANSWER: A

78. Which of the following debt obligation ratings are provided by CRISIL?
A. Non-convertible debentures, bonds, preference shares
B. Commercial papers, Certificate of Deposits, Short-term Debt
C. Fixed Deposits, Loans
D. all the above
ANSWER: D
79. PAN (Permanent Account Number) card information is maintained by -
A. Union Home Ministry
B. Income Tax Department, CBDT
C. Ministry of External Affairs
D. CBEC
ANSWER: B

80. name of the first credit rating agency of india

A. CRISIL
B. SBI
C. SEBI
D. IRDI
ANSWER: A

81. Who has made credit rating is mandatory for any debenture that has maturity of more than 18 months ?
A. Government of India
B. SEBI
C. RBI
D. IRDBI
ANSWER: B

82. How many credit rating agencies are there in india ?

A. FOUR
B. SIX
C. FIVE
D. SEVEN
ANSWER: B

83. What is the india's first credit rating agency ?

A. CARE
B. ICRA
C. CRISIL
D. ONICRA
ANSWER: C

84. Which organization is the main promotor of the CRISIL ?

A. ICICI ltd & UTI
B. ICICI ltd & PNB
C. ICICI ltd & SBI
D. SBI ltd & PNB
ANSWER: A

85. What is the full form of I in the ICRA ?

A. Investment Information and Credit Rating Agency of India Limited
B. Investors and Credit Rating Agency of India Limited
C. indian and Credit Rating Agency
D. internal Credit Rating Agency
ANSWER: A

86. ______includes all activities involved in the transformation of savings into investment
 A. Financial system
B. Financial services
C. economic system
D. savings system
ANSWER: B

87. services are mainly provided to foreign investors.

A. Custodial services
B. Factoring services
C. Financial services
D. none of the above
ANSWER: A

88. Education loan is maximum Rs____ for study in India

A. 5 lakhs
B. 7.5 lakhs
C. 10 lakhs
D. 3 lakhs
ANSWER: B

89. Full service factoring is often

A. Recourse factoring
B. Non-recourse factoring
C. Agency factoring
D. None of these
ANSWER: A

90. Disclosed factoring is also known as

A. Recourse factoring
B. Agency factoring
C. Non-recourse factoring
D. Notified factoring
ANSWER: B

91. Banking functions centrally controlled by the

A. central bank
B. RBI
C. SBI
D. IRBI
ANSWER: B

92. What is the apex organisation of Industrial Finance in India ?

A. Industrial Finance Corporation
B. Industrial Credit and Investment corporation of India
C. Industrial Development Bank of India
D. None of these
ANSWER: C

93. The primary objective of Nationalization of Banks was

A. Improving credit facilities
B. Financing the industries
 C. Improving security of deposits
D. Consolidating the economy
ANSWER: D

94. The national Stock Exchange is located in:

A. New Delhi
B. Nagpur
C. Mumbai
D. Kolkata
ANSWER: C

95. EXIM Bank was set-up in:

A. 1980
B. 1982
C. 1986
D. 1984
ANSWER: B

96. Rating indicate the ____status of a company.

A. Financial
B. Goodwill
C. Profit
D. As per law
ANSWER: A

97. commercial paper has _________ maturity.

A. fixed
B. short term
C. term period
D. none of the above
ANSWER: A

98. state bank of INDIA started merchant banking in

A. 1972
B. 1978
C. 1973
D. 1980
ANSWER: C

99. ICICI started merchant banking in

A. 1974
B. 1978
C. 1980
D. 1981
ANSWER: A

100. Formal merchant banking activity in India was originated in______.

A. 1978
B. 1969
C. 1980
D. 1989
 ANSWER: B

101. The early growth of merchant banking in the country is assigned to the ________.
A. FERA
B. Foreign Exchange Regulation Act, 1973
C. Securities Contracts Act
D. Income-tax Act
ANSWER: B

102. The financial services industry has seen ______ growth in the last few years
A. Booming
B. Steady
C. slowly
D. mushroom
ANSWER: D

103. It is a device for financing the cost of an asset.

A. Lease
B. Rate
C. Contract
D. Pricing
ANSWER: A

104. OTCEI is a ______

A. stock exchange
B. national exchange
C. RBI
D. SBI
ANSWER: B

105. there is no trading floor in

A. BSE
B. NSE
C. SEBI
D. All the above
ANSWER: B

106. members of OTCEI are _________ only

A. corporate
B. individual
C. group
D. government
ANSWER: A

107. Rating are expressed in

A. Rupees
B. currency
C. dollar
D. code numbers
ANSWER: D
108. AAA refers to
A. code
B. highest security
C. grants
D. none of the above
ANSWER: B

109. People who take part in factoring services includes

A. Buyer of the goods who has to pay for them on credit firms
B. Seller of goods, who has to pay for them on credit firms
C. Factor, who acts as gent in realizing credit sales form buyer and passes on the realized sum to the seller after
deducting a commission
D. All of the above
ANSWER: D

110. Factoring starts with ______ made by the seller, and is mainly concerned with the realization of credit sales.
A. Buyers
B. Seller
C. Credit sales
D. Commission
ANSWER: C

111. . Identify the advantage of factoring

A. It helps improve the scope of operating leverage
B. It helps improve the SSI
C. Difficulties arising from the financial evaluation of clients
D. none of the above
ANSWER: A

112. the contract entered into between the of goods and the ______ is called factoring contract.
A. Seller, factor
B. Buyer, factor
C. Contractor, contractee
D. Buyer, seller
ANSWER: A

113. Factoring covers only those _______ which are not supported by negotiable instruments.
A. Bills
B. Fiduciary payments
C. Receivables
D. Recourse
ANSWER: C

114. Factoring is a _______ financial service.

A. Capital-based
B. Finance-based
C. Fund-based
D. Factor-based
ANSWER: C

115. The ______ is the apex organization in the Indian money market.
 A. SBI
B. RBI
C. ICICI
D. IDBI
ANSWER: B

116. _______ is example of financial intermediaries.

A. Commercial banks.
B. Insurance companies.
C. Insurance companies.
D. Credit unions.
ANSWER: C

117. The control banks roles important as the _______ of credit.

A. Organizer
B. Operator
C. Controller
D. Lender
ANSWER: C

118. In any market ________ are the most important lenders.

A. Money market
B. Commercial banks
C. State banks
D. Financial institutions
ANSWER: B

119. ______ is a passport to, safety, convenience, prestige and credit.

A. Debit card
B. ATM card
C. Credit card
D. All of the above
ANSWER: C

120. The credit card holders can use the cards to get credit from banks upto ______.
A. 45 days
B. 35 days
C. 25 days
D. 90 days
ANSWER: A

121. Stock broker is a member of a recognized stock exchange who _____ in securities
A. buys
B. sells
C. deals
D. all of the above
ANSWER: D

122. Due to lack of liquidity in the cash segment, SEBI has allowed delivery of _____ in the physical trading.
A. Demat securities
B. securities
 C. Demat format
D. none of the above
ANSWER: A

123. The first depository in India named National Securities Depository Ltd. (NSDL) was established in ______.
A. 1996
B. 1969
C. 1980
D. 1982
ANSWER: A

124. ________means issue of electronic certificates in factor of operations of the computerized book entry transfer
for the securities
A. Materialization
B. Depository
C. Dematerialization
D. Security
ANSWER: C

125. The term _____ is defined as a central location for keeping securities on deposit.
A. Depository
B. Instrument
C. Institutions
D. None of the above
ANSWER: A

126. The origin of Credit rating can be traced to the _____.

A. 1840
B. 1842
C. 1895
D. 1845
ANSWER: A

127. Certificate of deposits are known as-

A. Negotiable Certificate of Deposit
B. Certificate of Deposit
C. Commercial certificate
D. None of the above
ANSWER: A

128. Term lending institutions are _____ market intermediaries.

A. Money
B. Capital
C. Stock
D. All of the above
ANSWER: B

129. Underwriting of shares is kind of

A. Fund based
B. Capital based
C. Credit based
 D. Savings
ANSWER: A

130. E-business software is best defined as to manage

A. sell-side e-commerce applications.
B. internal administrative applications.
C. buy-side applications
D. customer side
ANSWER: A

131. CRM stands for

A. Customer Relationship Management
B. Customer Relations Management
C. custom office
D. none of the above
ANSWER: A

132. E-commerce involves the application of

A. Knowledge Management systems
B. Product Management systems
C. Services Management systems
D. all the above
ANSWER: A

133. In India forfaiting is done by ________ bank

A. EXIM bank
B. Foreign bank
C. RBI
D. SBI
ANSWER: A

134. Which of the following is a fee based service

A. hire purchase
B. capital issue management
C. Underwriting
D. leasing
ANSWER: B

135. Under factoring the factor acts in the capacity of

A. an agent of his client
B. a trustee
C. a holder for value,
D. Anadministrator
ANSWER: C

136. What is the full form of IRR?

A. Internal Rate of Return
B. Internal Reserve Ratio
C. Internal Rate of Ratio
D. Internal Recession Rate
ANSWER: B
137. The Internet doesn't provide e-marketers with:
A. access to market places
B. access to global markets
C. access to mass-markets.
D. access to a broad range of demographic segments
ANSWER: D

138. E-procurement is
A. Procuring goods
B. Procuring the raw materials
C. Procuring the products
D. All of the above.
ANSWER: B

139. E-bay is a good example to define

A. B2B
B. B2C
C. C2C
D. C2B
ANSWER: C

140. What items are traded in e-business

A. Consumer durables
B. .Pharmaceutical products
C. .Industrial goods.
D. All of the above
ANSWER: D

141. ______ is the regulator of mutual funds in India

A. RBI
B. SBI
C. IRDA
D. Both SEBI and GOI
ANSWER: D

142. Consumer loans are granted for

A. Long period
B. Medium period
C. Short period
D. Any of the above
ANSWER: C

143. Zero Coupon Bond is also known as

A. Deep discount bond
B. Irredeemable bond
C. Bearer bond
D. Zero Interest bond
ANSWER: A

144. Native Stock and Share Brokers Association is the old name of
 A. SEBI
B. NSE
C. BSE
D. IRDA
ANSWER: C

145. UTI, LIC etc are examples of

A. Banking institution
B. Investment institution
C. NBFI
D. Development banks
ANSWER: B

146. LIC Housing Finance Ltd was established in the year

A. 1989
B. 1982
C. 1956
D. 1992
ANSWER: A

147. what is the full form of SWIFT?

A. Safe Window for Interbank Financial Transactions
B. Society for Worldwide Inter bank Financial Telecommunication
C. Society for Worldwide Inter bank Financial Telecommunication
D. Safe Window Institute For Transactions
ANSWER: C

148. What is the full form of NAV?

A. Net Actual Value
B. Net Annual Value
C. Net Asset Value
D. Net Average Value
ANSWER: C

149. Who issues 'Commercial Papers'?

A. A Company to a Bank
B. Banks to Banks
C. Banks to Companies
D. Company to its suppliers
ANSWER: B

150. In which year was the Banking Regulation Act passed?

A. 1949
B. 1950
C. 1952
D. 1953
ANSWER: A

Staff Name
Chitrakala I .