Quiz 447: Finance Business & Economy Current Affairs for Bank PO Exams

1.Many a times we read in the financial newspapers about a term “Derivative”. In this context, consider the following statements:
1. A derivative is an instrument which is settled at a Future Rate only.
2. The Value of this instrument gets derived from the change of the Interest Rates & Foreign Exchange Rates
3. In India, a Derivative can be traded in exchanges only.
Which among the above statements is / are correct?
(A)Only 1
(B)Only 1 & 2
(C)Only 2 & 3
(D)All are correct statements

2.We read in the newspapers about the deregulation of the Pricing of Petroleum Products by the Government of India. Consider the following outcomes of the above step:
1. This will make the petroleum products prices cheaper and the pricing system will become more transparent
2. This will improve the Financial health of the country’s Oil Marketing Companies and will contribute to Fiscal Consolidation
3. This will end the subsidy on the petroleum products.
Which among the above statements hold correct?
(A)Only 1
(B)Only 2
(C)Only 2 & 3
(D)Only 1 & 3

3.Consider the following statements regarding the Indian Depository Receipts?
1. An IDR declares ownership of shares of a Foreign Company
2. The Shares in an IDR are held by an Indian Custodian
3. Using IDR, the Indian Residents get a chance to invest in a listed Foreign entity
Which among the above statements is / are correct?
(A)Only 1
(B)Only 2
(C)Only 1 & 2
(D)Only 1 & 3

4.Consider the following:
1. Repo Rate
2. Reverse Repo Rate
3. Bank Rate
4. Base Rate
Which among the above are the constituents of the “interest rate corridor” used by the Reserve Bank of India?
(A)Only 1 & 2
(B)Only 1
(C)Only 1, 2 & 3
(D)all of the above

5.An edible oil importer is planning to import edible oil worth US Dollar 100,000. He placed an order on November 1, 2010 and the date of delivery is February 1, 2011. To save himself from the possible fluctuations in the exchange rates he would most probably adopt which of the following
(A)Currency Future
(B)Currency Swap
(C)Non-deliverable forward
(D)Forward contract

6.Which among the following curve defines the principle that zero tax rate would produce zero revenue for the government and a 100% tax rate would also generate zero revenue for the taxing Government?
(A)Laffer curve
(B)Lorenz curve
(C)Engel curve
(D)Kuznets curve

7.Consider the following:
1. Auto Loan
2. Home Loan
3. Infrastructure Project Financing
4. Personal Loans
Which among the above can lead to a problem called “asset-liability mismatch” or ALM for a medium sized Bank ?
(A)Only 1 , 2 & 3
(B)Only 2 & 3
(C)Only 3
(D)None of them

8.Many a times we read in the newspapers that when Foreign Capital is allowed to enter the country freely, it can affect the economy adversely. Which among the following is a correct reason for the above assumption?
(A)It affects the balance of payments of the country by adversely affecting the Current Account
(B)It poses risks to the value of the country’s currency as well as management of local liquidity
(C)The foreign capital earns profit in the country which is repatriated
(D)The Balance of Trade of the country is badly affected by Foreign Capital Inflows

9.Which among the following is the Biggest Borrower in India?
(A)Indian Government
(B)Reserve Bank of India
(C)Indian Railways
(D)State Governments

10.Which among the following would result in the fall in asset prices?
(A)Low Liquidity in the Economy
(B)High Liquidity in the Economy
(C)RBI increasing the Reverse Repo Rates
(D)RBI allows more banks to play

11.In the Credit card business, following parties play the role:
1. Credit card issuing bank
2. Bank that has installed the point of sales terminal, known as acquiring bank
3. Payment company such as Visa , MasterCard or American Express
Which among the above parties make the maximum revenue in the Card Business?
(D)all make equal money

12.Which among the following is the most reasonable idea behind issuing the “sweat equity” by the companies now a days?
(A)To provide more profits to the retail investors
(B)To provide more profits to the corporate investors
(C)To retain the best employees
(D)To save tax

13.Which among the following is the designated body to carry out the KYC compliance procedure for mutual fund investors in India?
(A)Securities and Exchange Bureau of India
(B)Reserve Bank of India
(C)CDSL Ventures Limited
(D)Central Depository Services India Limited

14.Consider the following steps in Budget Procedure in India:
1. The demands for grants of various ministries and departments including railways are considered by the concerned standing committees
2. Broad contours of the budget and the principles and policies underlying it are discussed.
3. A cut motion is moved in the Lok Sabha
4. Budget is presented in the House.
Which among the following is the correct sequence of the above steps?
(A)1 2 3 4
(B)1 2 4 3
(C)4 2 1 3
(D)3 1 4 2

15.Recently, Guido Mantega used the word “Currency War” referring the China’s attempt to protect the yuan from rising too quickly against the dollar. Guido Mantega is the finance Minister of which of the following countries?
(B)South Africa

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  • Anonymous

    Thanks for this invaluable help
    But in question number 10. the answer should be the A (i.e. low liquidity in the economy)

  • Anonymous

    thanks for cooperation

  • deep

    I loved question 14, thanks.

  • Anonymous

    sir plz
    describe tier 1 ,2 and 3 city what is this

  • Anonymous

    thanx for these questions. these will be very much banaficial for me..

  • Anonymous

    doubt in ques no 3rd and 5th, kindly explain

  • Anonymous

    dear sir in the question no:-2
    why not point 3 means(3. This will end the subsidy on the petroleum products)
    deregulation means remove the subsidy,
    if is not then why fiscal consolidation