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QUESTION PAPER FOR CLASS TEST I (July 6, 2008) NAME: --------------------------------------------------------------------------------------------FILL IN THE BLANKS: 1.

________________ contracts are not standardized based on quantity or quality. 2. _______________ contract is an agreement between two parties to buy or sell a specified quantity and defined quality of a commodity at a certain time in future at a price agreed upon at the time of entering into the contract through regulated commodity exchanges 3. N.T.S.D. and T. S. D. Contracts are both ---------------contracts. 4. Commodities Market in India is regulated by _______________________ that functions under the Ministry of _________________________________. A. B. C. D. SEBI; Finance FMC; Consumer Affairs, Food and Public Distribution SEBI; Consumer Affairs, Food and Public Distribution FMC; Human Resources Development

5. Commodity Exchanges facilitate trading in derivatives to generally achieve the following important functions: A. Only Price Discovery B. Only Price Risk Management C. Both Price Discovery and Price Risk Management D. None of the above 6. The Commodity Exchanges in India are regulated and governed under the ____________________________________. A. Securities Contract (Regulation) Act, 1956 B. Forward Contracts (Regulation) Act, 1952 C. Companies Act, 1956 D. Depositories Act, 1996 7. Which of the following is a contract that gives the buyer (of the contract) the right but not the obligation to sell the underlying asset at a predetermined price? A. Put option B. Call option C. Future contract D. None of the above 8. Who among the following can trade as a Trading cum Clearing Member (TCM)?

A. Joint Hindu Undivided family (HUF) B. Partnership Firm C. A Statutory Organization D. All of the above 9. The Initial Security Deposit can be paid in which of the following forms? A. 100% Bank Guarantee (BG) and Fixed Deposit Receipt (FD) with an exchange approved bank B. Minimum of 50% in Cash and balance 50% by way of FD or BG with approved banks C. Minimum of 25% in Cash and balance 75% by way of FD or BG with approved banks D. Maximum of 50% in Cash and the balance 50% in the form of FD or BG with approved banks 10. The end-of-day Mark to Market settlement on Commodity Futures contracts is done on a ___________ settlement period. A. T+3 B. T+1 C. T+2 D. None 11. Technical Analysis is a tool to study ------------ alone. A. Market action B. Quality parameters C. Demand & Supply D. None of the above 12. All up trends, in any market, have a succession of rising tops and rising bottoms (successive higher peaks and troughs). A. True B. False 13. Double tops and Double Bottoms are signs of reversals in the trend. Is this true or false? A. True B. False 14. Intrinsic value of a call option is the difference between its -------------- price and the -------------price. A. Current, strike B. Current, spot C. Strike, spot 15. Basis is the difference between ----------- price and ---------- price of the underlying asset. A. Cash, Futures B. Intrinsic, Spot

C. Basic, Futures 16. Market is said to be in Contango when the basis for a commodity is ---------A. Positive. B. Negative C. Either positive or negative 17. Market is said to be in Backwardation when the basis for a commodity is -----A. Positive. B. Negative C. Either positive or negative 18. An option is said to be in the money when its intrinsic value is -------------. A. Negative B. Positive. C. Either positive or negative 19. An option is said to be out of the money when its intrinsic value is ----------. A. Negative B. Positive. C. Either positive or negative 20. Current price of gold in the spot market is Rs. 9500/- per ten grams. What should be the fair value of four months one Kg. Gold Futures contract if the cost of financing is 12% per annum compounded on monthly basis? Assume that storage or other costs associated with gold are in-built into the cost of financing.