All About Demat Account Quiz
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Everything you know about the Demat account will be tested in this quiz. The dematerialized account number is important in the success of electronic transactions. For shareholders, a Demat account is needed to access profits earned. With internet and transaction passwords obtained, transfers, as well as buying of securities, is a walk over. Do you think you are a business guru? Let's see!
- 1.
The use of a Demat account protects one from the following except
- A.
Loss on account of mutilation
- B.
Loss on account of fraud
- C.
Loss on account of theft
- D.
Loss on account of fire
Correct Answer
B. Loss on account of fraudExplanation
A Demat account is a digital form of holding securities, such as stocks and bonds, eliminating the need for physical certificates. It provides a secure and convenient way to hold and trade securities. Loss on account of fraud refers to situations where someone intentionally deceives or tricks an individual to gain unauthorized access to their account or steals their securities. However, a Demat account does protect against such frauds by providing secure login credentials, encryption technologies, and regular monitoring of transactions. Therefore, the correct answer is Loss on account of fraud.Rate this question:
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- 2.
Delivery failures can be caused by all of the following except
- A.
Long distance
- B.
Postal delay
- C.
Signature mismatch
- D.
Loss of certificate
Correct Answer
A. Long distanceExplanation
Delivery failures can be caused by postal delay, signature mismatch, and loss of certificate. However, long distance is not a factor that typically causes delivery failures. The distance between the sender and recipient may affect the duration of delivery, but it does not directly cause failures in the delivery process.Rate this question:
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- 3.
Which of these is unavoidable for a Demat account holder?
- A.
Stock certificates
- B.
Filling up of transfer deeds
- C.
Stamp duty
- D.
High transaction cost
Correct Answer
D. High transaction costExplanation
A demat account is an electronic account used to hold securities in a digital format. One of the unavoidable aspects of having a demat account is the high transaction cost. When buying or selling securities, there are various charges involved such as brokerage fees, transaction charges, and taxes. These costs are necessary for the smooth functioning of the stock market and are incurred by the demat account holder for every transaction made. Therefore, high transaction costs are an inevitable part of having a demat account.Rate this question:
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- 4.
As of March 2016, how many depository participants were registered with SEBI?
- A.
940
- B.
932
- C.
891
- D.
538
Correct Answer
D. 538Explanation
In March 2016, there were 538 depository participants registered with SEBI.Rate this question:
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- 5.
What is the role of banks in the dematerialization process?
- A.
They maintain accounts by NSDL
- B.
The update accounts of investors
- C.
They maintain accounts by CDSL
- D.
They act as intermediaries
Correct Answer
B. The update accounts of investorsExplanation
Banks play a crucial role in the dematerialization process by updating the accounts of investors. This means that banks are responsible for recording and reflecting any changes or transactions made by investors in their demat accounts. This includes activities such as buying or selling securities, transferring shares, or any other updates related to the investor's holdings. By performing these updates, banks ensure that the demat accounts accurately reflect the investor's current holdings and facilitate smooth and efficient trading in the securities market.Rate this question:
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- 6.
How many forms of charges are recorded for Demat accounts?
- A.
Two main charges
- B.
Five main charges
- C.
Three main charges
- D.
Four main charges
Correct Answer
D. Four main chargesExplanation
There are four main charges recorded for Demat accounts.Rate this question:
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- 7.
Concerning charges on a Demat account which of these is odd?
- A.
Custodian fee
- B.
Legal protection fee
- C.
Annual maintain fee
- D.
Account opening fee
Correct Answer
B. Legal protection feeExplanation
The odd one out in this list is the "Legal protection fee." This is because while the other charges mentioned, such as custodian fee, annual maintenance fee, and account opening fee, are common charges associated with a Demat account, the legal protection fee is not typically charged for a Demat account. It is more commonly associated with insurance or legal services.Rate this question:
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- 8.
All of these banks do not charge account opening fee save for:
- A.
ICICI Bank
- B.
AXIS Bank
- C.
HDFC Bank
- D.
International Merchant Bank
Correct Answer
D. International Merchant BankExplanation
The given answer states that the International Merchant Bank charges an account opening fee, while the other three banks (ICICI Bank, AXIS Bank, and HDFC Bank) do not. This implies that out of the given options, only the International Merchant Bank requires customers to pay a fee when opening an account.Rate this question:
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- 9.
Which of these document is not required for opening demat account?
- A.
Aadhar card
- B.
Income Tax Return
- C.
Date of birth certificate
- D.
Address Proof
Correct Answer
C. Date of birth certificateExplanation
The correct answer is "Date of birth certificate". While Aadhar card, Income Tax Return, and Address Proof are all commonly required documents for opening a demat account, a date of birth certificate is not typically necessary. The other documents provide important information such as identification, income, and address verification, but the date of birth can usually be verified through other means such as the Aadhar card or other identification documents.Rate this question:
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- 10.
When did the use of demat accounts start in India?
- A.
1992
- B.
1995
- C.
1996
- D.
1997
Correct Answer
C. 1996Explanation
The use of demat accounts started in India in 1996. This means that before this year, investors in India had to hold physical share certificates to trade in the stock market. The introduction of demat accounts revolutionized the Indian stock market by allowing investors to hold their securities in an electronic format, eliminating the need for physical certificates and simplifying the trading process.Rate this question:
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