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EEFC Account stands for:
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Export Earning Foreign Currency Account
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External Earnering Foreign Currency Account
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Exchange Earner Foreign Currency Account
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None
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About This Quiz
Are you ready for the Indian financial system trivia quiz? It is nearly impossible for a business not to have lenders, and the Indian financial system makes it possible for lenders, borrowers, and investors to interact with each other. How well do you understand the money market instruments in this system? Do take the quiz and get a refresher on See morethe Indian financial system and the components within it, and how they help the economy.
Quiz Preview
- 2.
ADR Stands for:
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Asset Depository Receipt
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Asian Depository Receipt
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American Depository Receipt
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Adjustable Depository Receipt
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American Demand Receipt
Correct Answer
A. American Depository ReceiptExplanation
ADR stands for American Depository Receipt. ADRs are certificates issued by U.S. banks that represent shares of a foreign company's stock. They allow U.S. investors to invest in foreign companies without having to directly buy shares on foreign stock exchanges. ADRs are traded on U.S. stock exchanges and are denominated in U.S. dollars, making it easier for American investors to buy and sell them. ADRs provide a convenient way for investors to diversify their portfolios and gain exposure to international markets.Rate this question:
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- 3.
GDR stands for
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Global Demand Receipt
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Global Depository Receipt
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Global Direct Revenue
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Gross Demand Revenue
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None
Correct Answer
A. Global Depository ReceiptExplanation
GDR stands for Global Depository Receipt, which is a financial instrument used to raise capital in international markets. It represents shares in a foreign company and allows investors to trade those shares outside of the company's home country. GDRs are often listed on international stock exchanges and can provide global investors with an opportunity to diversify their portfolios and access foreign markets.Rate this question:
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- 4.
In --------------- Securities share bond debentures are offered to the public for subscription for the purpose of raising capital or fund.
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Prime Securities
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Public Securities
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Preferred Securities
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Primary Securities
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None
Correct Answer
A. Primary SecuritiesExplanation
Primary securities refer to financial instruments such as shares, bonds, and debentures that are offered to the public for subscription in order to raise capital or funds. These securities are typically issued by companies or governments to finance their operations or investment projects. The term "primary" indicates that these securities are being issued for the first time, as opposed to secondary securities which are traded in the secondary market. Therefore, the correct answer is Primary Securities.Rate this question:
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- 5.
The structure that is available in an economy to mobilize the capital from various surplus sectors of the economy and allocate and distribute the same to the various needy sectors is known as ----------
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Economic Environment
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Financial Environment
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Financial System
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Financial Market
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None
Correct Answer
A. Financial SystemExplanation
The correct answer is Financial System. The financial system refers to the structure and institutions in an economy that facilitate the mobilization of capital from surplus sectors and allocate it to needy sectors. It includes banks, financial markets, financial intermediaries, and regulatory bodies. These components work together to ensure the efficient flow of funds and support economic growth.Rate this question:
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- 6.
Treasury bills are money market instruments.
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True
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False
Correct Answer
A. TrueExplanation
Treasury bills are indeed money market instruments. Money market instruments are short-term debt securities that are highly liquid and have a maturity of less than one year. Treasury bills, also known as T-bills, are issued by the government to raise funds and are considered one of the safest investments as they are backed by the full faith and credit of the government. They are actively traded in the money market and are commonly used by investors and financial institutions to park excess cash or as a low-risk investment option. Therefore, the statement "Treasury bills are money market instruments" is true.Rate this question:
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- 7.
Commercial paper is a money market instrument.
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True
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False
Correct Answer
A. TrueExplanation
Commercial paper is indeed a money market instrument. Money market instruments are short-term debt securities that are highly liquid and have low risk. Commercial paper is issued by corporations to raise funds for their short-term financing needs. It typically has a maturity of less than a year and is typically bought by institutional investors. As a money market instrument, commercial paper provides a way for corporations to access short-term funding while providing investors with a relatively safe and liquid investment option.Rate this question:
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- 8.
Commercial paper is a money market instrument.
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True
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False
Correct Answer
A. TrueExplanation
Commercial paper is indeed a money market instrument. Money market instruments are short-term debt securities that are highly liquid and have a maturity period of less than one year. Commercial paper is a type of unsecured promissory note issued by corporations to raise short-term funds. It is typically used to finance current operations, such as inventory purchases or accounts receivable. Commercial paper is considered a safe investment due to the creditworthiness of the issuing corporation and is commonly traded among institutional investors in the money market. Therefore, the statement "Commercial paper is a money market instrument" is true.Rate this question:
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- 9.
Bonds issued by Financial Institutions are instruments in the Debt markets.
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True
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False
Correct Answer
A. TrueExplanation
Bonds issued by financial institutions are indeed instruments in the debt markets. This means that financial institutions, such as banks or credit unions, issue bonds as a way to borrow money from investors. These bonds represent a debt obligation for the financial institution, and they typically pay interest to the bondholders. Therefore, the statement "Bonds issued by Financial Institutions are instruments in the Debt markets" is true.Rate this question:
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- 10.
Registrars maintain a Register of share and debenture holders and process share and debenture allocation when issues are subscribed. Registers need approval from the Regulator. SEBI is the Regulator.
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True
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False
Correct Answer
A. TrueExplanation
The statement is true because registrars are responsible for maintaining a register of share and debenture holders and processing share and debenture allocations. Additionally, these registers need approval from the regulator, which in this case is SEBI (Securities and Exchange Board of India). Therefore, it can be concluded that the statement is correct.Rate this question:
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- 11.
Bonds issued by Financial Institutions are instruments in the Debt markets.
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True
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False
Correct Answer
A. TrueExplanation
Bonds issued by financial institutions are indeed instruments in the debt markets. Financial institutions, such as banks or insurance companies, often issue bonds as a way to raise capital. These bonds represent a debt obligation of the institution, where investors lend money to the institution in exchange for periodic interest payments and the return of the principal amount at maturity. Therefore, the statement "Bonds issued by Financial Institutions are instruments in the Debt markets" is true.Rate this question:
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- 12.
Reserve Bank of India has two distinct roles one is Monetary Control including controlling inflation.
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True
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False
Correct Answer
A. TrueExplanation
The given statement is true. The Reserve Bank of India indeed has two distinct roles. One of its roles is monetary control, which involves implementing measures to regulate the money supply in the economy and control inflation. The central bank uses various tools such as interest rates, open market operations, and reserve requirements to manage inflation and ensure price stability. Therefore, the statement is correct.Rate this question:
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- 13.
Reserve Bank of India is exercising Monetary Control through 1) cash Reserve Ratio, 2) Statutory Liquidity Ratio 3) REPO rate and Bank Rate.
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True
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False
Correct Answer
A. TrueExplanation
The statement is true because the Reserve Bank of India exercises monetary control through various tools, including the cash reserve ratio, statutory liquidity ratio, repo rate, and bank rate. The cash reserve ratio refers to the percentage of deposits that banks are required to keep with the central bank, while the statutory liquidity ratio refers to the percentage of deposits that banks must maintain in the form of liquid assets. The repo rate is the rate at which the central bank lends money to commercial banks, and the bank rate is the rate at which the central bank lends money to other banks. By adjusting these rates and ratios, the Reserve Bank of India can influence the money supply and control inflation.Rate this question:
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- 14.
Central Bank (RBI) is the lender of the last resort to other Banks.
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True
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False
Correct Answer
A. TrueExplanation
The statement is true because the Central Bank, in this case the Reserve Bank of India (RBI), acts as the lender of last resort to other banks. This means that in times of financial distress or when banks are unable to meet their obligations, the RBI provides them with liquidity support and emergency funds. This helps to maintain stability in the banking system and prevents the collapse of individual banks, which could have a detrimental impact on the overall economy.Rate this question:
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- 15.
It will not is responsible for ensuring an efficient payment & settlement system.
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True
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False
Correct Answer
A. TrueExplanation
The statement is true because "It" refers to a subject that is responsible for ensuring an efficient payment and settlement system. This implies that there is an entity or organization that has the responsibility for maintaining and overseeing the payment and settlement processes to ensure they are efficient.Rate this question:
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- 16.
Reserve Bank of India has supervision over 1) Commercial Bank, 2) NBFC, 3) Primary dealers 4) Financial institutions.
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True
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False
Correct Answer
A. TrueExplanation
The Reserve Bank of India has supervision over commercial banks, NBFCs (Non-Banking Financial Companies), primary dealers, and financial institutions. This means that the RBI is responsible for regulating and overseeing these entities to ensure their compliance with regulations and maintain the stability of the financial system. Therefore, the statement "True" is correct.Rate this question:
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- 17.
Capital Market Regulator in India is SEBI.
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True:
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False
Correct Answer
A. True:Explanation
SEBI, which stands for Securities and Exchange Board of India, is indeed the capital market regulator in India. It is a statutory regulatory body that oversees and regulates the securities market in the country. SEBI's role includes protecting the interests of investors, promoting fair and transparent market practices, and ensuring the development and regulation of the securities market in India. Therefore, the statement "Capital Market Regulator in India is SEBI" is true.Rate this question:
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- 18.
The standard rate at which RBI is prepared to buy or re-discount bills of exchange or other eligible commercial papers from Banks is known as Bank Rate.
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True
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False
Correct Answer
A. TrueExplanation
The given statement is true. The standard rate at which the Reserve Bank of India (RBI) is willing to buy or re-discount bills of exchange or other eligible commercial papers from banks is known as the Bank Rate. This rate is an important tool used by the RBI to control the money supply and influence the economy. By adjusting the Bank Rate, the RBI can incentivize or discourage borrowing and lending activities in the banking system.Rate this question:
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- 19.
Central Bank (RBI) is the lender of the last resort to other Banks.
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True
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False
Correct Answer
A. TrueExplanation
The statement is true because the Central Bank, in this case the RBI, acts as the lender of last resort to other banks. This means that when banks are facing financial difficulties and are unable to borrow from other sources, they can turn to the Central Bank for emergency funds. The Central Bank provides this liquidity support to ensure the stability and smooth functioning of the banking system.Rate this question:
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- 20.
Reserve Bank of India is Banker to Government.
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True
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False
Correct Answer
A. TrueExplanation
The Reserve Bank of India (RBI) acts as the banker to the government. This means that the RBI manages the government's accounts, handles its transactions, and provides financial services to the government. As the banker to the government, the RBI plays a crucial role in managing the government's finances, maintaining stability in the financial system, and implementing monetary policies to promote economic growth and stability. Therefore, the statement that the RBI is the banker to the government is true.Rate this question:
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Quiz Review Timeline (Updated): Feb 28, 2023 +
Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.
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Current Version
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Feb 28, 2023Quiz Edited by
ProProfs Editorial Team -
Aug 13, 2013Quiz Created by
Bishnu1960
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