PRINCIPLES OF BANKING (JAIIB) Test-03

1)_______are not an intermediary in the financial system? A Insurance companies B Banking companies/Financial Institutions C Mutual funds D None of the above 2)_______Act classifies the banks into scheduled banks and non-scheduled banks. A Banking Regulation Act B RBI act C Companies Act D None of the above 3) The interest rate paid on government securities on fixed basis is known as___ A Bank Rate B Coupon C Prime Lending Rate D None of the above 4) The market where new issues of capital are dealt with, is _____ A Stock Market B Secondary Market C Primary Market D None of the above 5) A banking company is issued license for banking operations under ________. A Section 22 of Banking Regulations Act B Section 23 of Banking Regulation Act C Section 24 of RBI act D Section 23 of RBI Act 6) What is the minimum CRR as per RBI Act now? A No minimum B 5% C 3% D 25% 7) What is the interest rate that is payable on CRR as per extant guidelines? A 3% B 4% C 3.5% D No interest 8)____ manages the National Equity Fund. A SIDBI B IIBI C IFCI D SIDBI 9) For meeting day-to-day receipt and expenditure mismatch, RBI provides _____to Governments. A Treasury Bills B Ways and means advance C Dated securities D All the above E None of the above 10) Banking has been defined in _______. A Companies Act B RBI Act C Banking Regulation Act D Indian Trust Act E All the above 11) What is a Secured loan or advance as per Banking Regulation Act? A Secured by collateral security B Secured by tangible security C Security of assets the market value of which not less them amount of loan D All the above

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12) A banking company can hold immovable property for its own use for a period? A Of three years B Of five years C Exceeding five years D Indefinitely 13) Scheduled banks are required to transfer minimum of __ % of their profits to Statutory Reserve Fund. A 15 % of the profits B 20 % of the profits C 25% of the profits D 25% of the profits before dividend 14) Financial sector Reforms phase started in India in the year? A 1989 B 1990 C 1991 D 1992 15) The term Customer is defined under: a) Banking Regulation Act b) Negotiable Instruments Act c) Indian Contract Act

d)

KYC guidelines 16) The Banker-customer relationship when between the banker and customer in case of lockers? a) Lessor and Lessee b) Trustee and Beneficiary c) Agent-Principal d) Bailor and Bailee 17) The Banker-customer relationship when the bank accepts cash for outward remittance is ____? a) Debtor and Creditor b) Bank and a Customer c) Beneficiary and Trustee d) Agent and Principal 18) Right of lien is conferred upon bankers in India by virtue of a ------------. Therefore, no separate ------------ is necessary. Statute, agreement Agreement, document Contract, agreement None of the above 19) Bankers right to lien has no limitation period. a) True b) False 20) The rule in Claytons case applies in the case of : a) Partnership accounts b) Running accounts having debit balances. c) Ltd Company accounts d) Accounts having credit balances 21) Which of the following is an essential condition for exercising the right of Set-off? a) All the accounts in the capacity of borrower and depositor should be the same. b) There should not be a contract to the contrary. c) The amount of loan should be specific and due for payment d) All of the above

22) Subsidiaries of the State Bank are companies registered under the Companies Act. a) True b) False

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PRINCIPLES OF BANKING (JAIIB) Test-03

23) Transfer of funds from the partnership account, to the credit of the account of partner to set-off a debit balance, is in order. a) True b) False 24) Mandates cannot be accepted, from limited companies and cooperative societies. a) True b) False 25) A cheque is a Bill of exchange where the Drawee is always a Banker. a) True b) False
26) Which authority is competent to issue Garnishee order? a) Income Tax Department. b) Police Commissioner c) A competent court d) Any State Government official e) Up to the time it does not become stale 27) As per Section 118 of the Negotiable Instrument Act, 1881, consideration in the case of Negotiable Instruments is______. a) Waived; or b) To be proved by the plaintiff; or c) Immaterial; or d) Presumed 28)_____ is not a Negotiable instrument. a) Commercial Paper; b) Certificate of Deposit c) Term Deposit Receipt d) None of the above 29) What is the minimum denomination amount for a Commercial Paper: a) 5 lac b) 10 lac c) 25 lac d) None of above 30) What is the basic nature of a Commercial Paper: a) Bill of Exchange b) Hundi c) Usance Promissory Note d) Debenture 31) Bills drawn in respect of goods delivered by parties to various Government / Semi - Government Departments are known as ______: a) Accommodation Bills b) Supply Bills c) Usance Bills d) Government Bills 32) Certificate after Noting of dishonour issued by Notary Public is known as ____: a) Letter of administration b) Letter of dishonor c) Certificate of dishonor of bill d) Protesting 33) A cheque may be crossed by a) Drawer b) Holder c) Drawer or Holder d) None of these 34) Account Payee crossing is instructions to: a) Collecting banker b) Payee. c) Drawer banker d) a + b 35) The crossing which does not confer a better title on the transferee than the transferor himself is known as: a) Qualified crossing; or b) Account payee crossing; or.

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c) Special crossing; or d) Not Negotiable crossing 36) The holder of a bill or a cheque cannot sue the drawer before: a) The date it bears b) It is dishonoured c) It is cancelled d) It is noted or protested 37) A Cheque on payment becomes the property of the ____: a) Banker b) Drawer c) Payee d) Endorser 38) Who is permitted to open current account? a) Executors b) Administrators c) Liquidators d) Trustees e) All of the above 39) Interest in Saving Bank account is payable only if the amount of interest is not less than: a) Rs. 10 b) Rs. 5 c) Re. 1 d) 10 paise 40) Unclaimed deposits in banks are treated as _____ liability. a) Current b) Long Term c) Contingent d) None 41) Pensioners are required to furnish life certificate in the month of: a) January b) March c) September d) November 42) As per IBA, persons who have completed _____can be treated as senior citizens and can avail of the interest rate benefit i.e. special deposit scheme: a) 55 years b) 58 years c) 60 years d) 65 years 43) _____ abinitio void. a) Mortgage Deed executed by a Minor b) Mortgage Deed in favour of a Minor c) Mortgage of leasehold rights d) All of these 44) Adarsh ,a minor has been admitted as a partner, for the benefit of the partnership firm. On attaining majority he can opt out of Partnership within a period of ___ months: a) 3 months b) 6 months c) 9 months d) 12 months 45) Mr Anand a NRI has sold his house in India for Rs1.5 crores. He had bought it as a Resident three years ago out of rupee funds. He now has requested the branch to repatriate the amount. He has produced all required documents and tax clearances. a) Can not repatriate due to 10 year lock-in period. b) Can repatriate fully c) Can repatriate up to USD 100,000 only d) Can repatriate up to USD 10,000 only 46. Mr. Amrit was born in Dharwad, Karnataka. He migrated to UK in 1990. He is now a citizen of the UK and holds a British passport. He is now a___ a) NRI b) PIO c) Foreign National of Non-Indian origin d) Resident 47) A bank may take the initiative to close the account of an undesirable customer for which of the following reasons: a) If a forgery by the customer is detected. b) If the customer disregards the minimum balance rule often c) If the customer is countermanding payment of his cheques very often.

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PRINCIPLES OF BANKING (JAIIB) Test-03

d) Any of the above 48) Recently, a system of involving other financial institutions in the process of ON SITE supervision has evolved. Thus NABARD supervises State/central cooperative banks. Similarly, Housing finance companies are supervised by a) IDBI b) NHB c) HDFC d) All of the above 49) Off-site monitoring system (OSMOS) for surveillance over the banks was put in place by RBI: a) March 1996 b) April 1992 c) June 1999 d) Sep 2000 50) An order of moratorium is issued by: a) In current A/c b) TDR at Nil rate for minimum 3 years c) TDR at the rate at which loan is granted d) None of the above 51) In PMRY loans, collateral security in case of business enterprises is: a) Obtained invariably b) Obtained wherever available

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c) d) a)

Obtained if loan amount is above Rs.5 lac in industry and Rs. 2 lac in services

Not obtained even if offered except in Dairy / Poultry cases 52) The Small farmer is one who: Possess agriculture land upto 2.5 acre of irrigated or 5 acres of non-irrigated land b) Does not have income more than Rs.12,000 p.a. c) Possess agriculture land upto 8 acres 53) The maximum loan amount available in SLRS scheme is Rs.____: a) 25,000/b) 50,000/c) 32,500/d) No ceiling 54) Penal interest is not to be charged in case of Priority Sector upto an amount of Rs.: a) 5000 b) 10000 c) 25000 d) 20000 e) None 55) The Priority Sector target for Foreign Banks is __________ of net bank credit. a) 25% b) 28% c) 32% d) 40% 56) The maximum loan percent of project cost under SJSRY can be: a) 75% b. 80% c. 90% d. 95% 57) One of the following is not part of the weaker section in priority sector: a. SJSRY beneficiary b. SC/ST c. DRI d. NGO 58) Under DRI the maximum period for repayment of the loan including grace period is : a. 3 years b. 4 years c. 5 years d. 7 years 59) The projected turn over appraisal method is adopted to ascertain______: a) Expected Net profit b) Expected total sales c) Total interest earned d) Working capital requirements 60) What should be the minimum paid up capital and reserves to cover risk weightage against lendings? a) 5 percent b) 9 percent

c) 15 percent d) 20 percent 61) The core concept of marketing is that: a) The customer buys a benefit to satisfy a particular need b) The organisation must earn highest profits. c) The organisation must sell the product as much as possible. d) None of these 62) ______ is central to the whole marketing exercise. a) Manufacturer b) Supplier c) Customer d) All of these 63) Segmentation can be on the basis of: a) Social class b) Age, sex, income group c) Geographical location d) All of these 64) Banks can differentiate their services on a variety of dimensions, such as: a) Image b) Type & characteristics of accounts c) Location and opening hours d) All of these 65) Services are marked by a high degree of: a) Variability b) Individuality c) Heterogeneity d) All of these 66) Marketing research, when applied to banking, can be defined as _____ all facts about problems relating to transfer and sale of services from bankers to customer. a) Gathering b) Recording c) Analysing d) All of these 67) The seven Ps of service marketing in the context of banking services represent: a) Product, price, promotion, place, process, physical evidence and people b) Production, procurement, price, promotion, place, process and people c) Purchase, presentation, price, promotion, people, payment and persistent d) None of these 68) External marketing describes the normal work done by the company to _____ the service to customers. a) Prepare b) Price c) Distribute and promote d) All of these 69) _______ is a pure tangible good: a) Bread b) Milk c) Books d) All of the above 70) Expansion of product mix, Contracting the product mix, varying the features of existing product: Trading-up and trading-down: These are some of the _____Strategies. a) Product b) Promotional c) Both d) Neither 71) Product-attributed approach is inward looking and Product-led. While as Consumer-oriented, approach believes that Goods that best satisfy customer preferences have quality. a) True b) False 72)_______ is a stage in New Product Development. a) Idea generation /Screening. b) Business analysis, c) Developing & testing the product, d) All of the above 73) Under test marketing, the product is introduced in selected areas, often at different prices in different areas to give an estimation of the amount and elasticity of the demand for the product, the competition and the expected sales volume and profits that it might yield, at different prices.

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PRINCIPLES OF BANKING (JAIIB) Test-03

a) True b) False 74)______ may favour buying a Product which is in its decline stage. a) Innovators b) Middle majority c) Dare-devils d) laggards 75) Low-price and high promotional spending is likely to succeed in _____markets. a) Large b) Small c) International d) Local 76) Which system is mainly used in branch level computers? a) Windows b) Linux c) Unix d) None of these 77) The interconnectivity of computers to a common server within a small area is known as_____ a) LANb) WAN c) WWW d) None of these 78) What is Topology? a) The plan in which different computers are interconnected in LAN b) The plan in which different computers are interconnected in WAN c) The plan in which various devices are interconnected d) None of these 79) Which one is not a centralised controlling topology? a) Star b) Bus c) Tree d) Loop 80) When fed data is written and stored in two hard discs, simultaneously over the different channels, the system is known as____: a) Data mirroring b) Disc mirroring c) Data duplex d) Disc duplex 81) --------- is not a function of a Dumb terminal. a) Sending information b) Receiving information c) Memory processing d) None of the above 82) Retrieving data in case of a technical snag is the primary objective of ___: a) Disk mirroring b) Disk dupleXing help in c) Both d) Neither 83) Networking is done by either LAN or using a mini computer connected to all other computers through LAN. In the latter case, the other computers act as a) Intelligent terminals b) ALPMs c) Stand alone computers d) None of the above 84) If connectivity is established using microwaves, signals travel from one ---------- to other which are located not more than 25 miles away from each other. a) Computer b) Dish antenna c) Both a & b d) None of the above 85) Rules of communication between similar modules of processes in different nodes is called a) Protocol b) Uniform codes c) Uni -language d) All of the above 86)A -------------- combines individual data capacity needs of low speed and groups them to be able to transmit them on a single high speed line a) Token ring b) Multiplexer c) Host computer d) All of the above

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87) Three persons have signed loan documents on three different days. What should be the date of the documents? a) The date of the first day when one of them had signed b) The second days date c) The last days date when the documents were finally completed d) All the three different dates, as and when these were signed
88) Computer is an electronic device, which processes: a) Data b) Information c) Knowledge d) All of the above 89) In banking technology, normally ---------------UPS is used. a) On-line b) Off-line c) Stand alone d) All of the above 90) In an On-line UPS, the battery cum Rectifier converts ------------ input current to -------------. a) 48 V DC to 230 V b) 230 V to 48 DC c) 220 V to 110 V d) None of the above 91) Creation of ------------- is the most important prerequisite for Core banking solutions a) Central data base b) A product bouquet c) Efficient team of staff d) None of the above 92) For CBS which of the following are required: a) Branch functional modules, IS tools b) Multi product Delivery channels c) Interfaces to integrate systems such as RTGS d) All of the above 93) To ensure data confidentially encryption is available. a) On the SWIFT b) To the users c) a and b d) All the regional processor 94) To find information by making selection from a series of menus, the internet service used is. a) Tulnet b) Gopher c) Usenet d) FTP 95) In Local Area network each independent system is known as: a) Node b) Server c) CPU d) Computer 96) Stalking using computer resources is known as Spamming: a) True b) False 97) In Star and Tree topologies,the control is centralized and in Ring and Bus topologies, it is: Distributed control. a) True b) False 98) ______a requirements of Core Banking:

a)

Primary Data Centre / Consultancy Assistance b) Disaster recovery site(DRS) c) Business process reengineering(BPR) d) All of the above 99) Credit Card and Charge cards are one and the same. a) True b) False 100) United Western Bank was amalgamated with ____ by RBI. a) Centurion Bank

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PRINCIPLES OF BANKING (JAIIB) Test-03

b) Bank of Punjab c) Lord Krishna Bank d) IDBI Ltd.

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