Micro Finance Mock Test

15 Questions | By Catherinehalcomb | Last updated: Mar 22, 2022 | Total Attempts: 521

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Microfinance, also called microcredit, is a type of banking service provided to unemployed or low-income individuals or groups who otherwise would have no other access to financial services. Have a Micro Finance Exam coming up? Don't worry, take this Micro Finance Pre Test and prepare well.

Questions and Answers

1.

Rotating savings and unions credit associations transform into Accumulating Savings and Credit Associations when one of the following is done among others:
- A.
  
  Members can borrow from an accumulated fund outside contributions
- B.
  
  Some money is saved in a lock box or in some other more secure manner
- C.
  
  At the end of the cycle, members can choose to start a new round or to disband
- D.
  
  a pre-determined amount of money brought to weekly meetings is collected and passed to a different member each week on a rotating basis
2.

According to the Stakeholder concept, a microfinance employee would be ……in a typical microfinance sector
- A.
  
  a primary stakeholder
- B.
  
  a secondary stakeholder
- C.
  
  a solid stakeholder
- D.
  
  a client stakeholder
3.

Which one of these will be categorized as a semi-formal microfinance institution?
- A.
  
  Building society
- B.
  
  Rotating savings and unions credit association
- C.
  
  Rural bank
- D.
  
  Village bank
4.

Which one of these will be categorized as an informal microfinance institution?
- A.
  
  Building Society
- B.
  
  Rotating savings and unions credit association
- C.
  
  Rural bank
- D.
  
  Village bank
5.

The following are all development objectives of MFIs except:
- A.
  
  Adverse selection
- B.
  
  Employment creation
- C.
  
  Empower of women or other disadvantaged population groups
- D.
  
  poverty reduction
6.

….………………… methodologies help in creating social collateral (peer pressure) that can effectively substitute physical collateral in the MFI sector
- A.
  
  Formal
- B.
  
  Group
- C.
  
  Individual
- D.
  
  Informal
7.

A client would be classified as a(an) ………… and stakeholder
- A.
  
  External, primary
- B.
  
  External, secondary
- C.
  
  Internal, primary
- D.
  
  Internal, secondary
8.

The government would be classified as a(an) ………… and stakeholder.
- A.
  
  External, primary
- B.
  
  External, secondary
- C.
  
  Internal, primary
- D.
  
  internal, secondary
9.

Which of the following best defines microfinance?
- A.
  
  The provision of financial loans to the rural folks
- B.
  
  The provision of financial services to the low income, the poor, and the unbanked population
- C.
  
  The provision of small loans to micro, small, and medium enterprises
- D.
  
  The provision of small savings to the poor.
10.

Which of the following is NOT a benefit of regulation of Microfinance in a country?
- A.
  
  Financial soundness
- B.
  
  Protect the clients interest
- C.
  
  Reinforcing public trust
- D.
  
  Revising the cost of capital upwards
11.

Which of the microfinance regulation is a major constraint to existing and new entrants in the industry?
- A.
  
  Minimum capital requirement
- B.
  
  Provision of business plan
- C.
  
  Reserve requirement
- D.
  
  Restriction to expansion
12.

Strategic Decision making based on stakeholder theory results in a process characterized by three main features: These include each of the following except:
- A.
  
  Rationality
- B.
  
  Intuition
- C.
  
  Political behaviour
- D.
  
  Information