31 - Lending Operations

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1).
What do we call the money that is lent for one day in the call money market?
2).
Why do banks borrow money in the call money market?
3).
What do we call the money that is lent for more than one day but less than 15 days in the call money market?
4).
What is the maturity period of Money Market Instruments?
5).
What do we call the facility given to a current account holder of withdrawal of more amount than his deposit?
6).
What do we call an unconditional order to pay a certain amount on an agreed date?
7).
What is downpayment?
8).
What do we call the process of paying off an existing loan and establishing a new loan?
9).
Which of these is used as promise from a bank to make a payment assuming certain conditions are met?
10).
What do we call the guarantee given by the bank for a payment when the buyer is not able to pay the required amount of money to the seller?
1. What do we call the money that is lent for one day in the call money market?
[A] Call Money
[B] Notice Money
[C] Term Money
[D] Day Money
2. Why do banks borrow money in the call money market?
[A] To meet sudden demand for funds arising out of large outflows
[B] To fill the temporary mismatches in funds
[C] To meet the Statutory reserve requirements
[D] All of the above
3. What do we call the money that is lent for more than one day but less than 15 days in the call money market?
[A] Call Money
[B] Term Money
[C] Notice Money
[D] None of the above
4. What is the maturity period of Money Market Instruments?
[A] Less than 15 days
[B] Less than 1 year
[C] Less than 181 days
[D] Less than 90 days
5. What do we call the facility given to a current account holder of withdrawal of more amount than his deposit?
[A] Overdraft
[B] EMI
[C] Sweep-in Facility
[D] Recurring Deposit
6. What do we call an unconditional order to pay a certain amount on an agreed date?
[A] Promissory note
[B] Bill of exchange
[C] Money order
[D] None of the above
7. What is downpayment?
[A] Difference between the total purchase value and the loan amount
[B] First EMI of the loan amount
[C] Last EMI of the loan amount
[D] None of the above
8. What do we call the process of paying off an existing loan and establishing a new loan?
[A] Amortization
[B] Reconveyance
[C] Refinancing
[D] Servicing
9. Which of these is used as promise from a bank to make a payment assuming certain conditions are met?
[A] Cash Credit
[B] Over Draft
[C] Letter of Credit
[D] Term Loan
10. What do we call the guarantee given by the bank for a payment when the buyer is not able to pay the required amount of money to the seller?
[A] Letter of Credit
[B] Bank Guarantee
[C] Bill of Lading
[D] None of the above
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