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INDIAN FINANCIAL SYSTEM

Total questions: 62

Worksheet time: 34mins

Name
Class
Date
1.

Indian Financial System includes

a)

Financial Market

b)

Financial Instruments

c)

Financial Services

d)

All of these

2.

A regulatory body set up to control trading of financial securities

a)

RBI

b)

SEBI

c)

SBI

d)

None of these

3.

Financial Market is classified into

a)

Organized and unorganized market

b)

Regulatory and non-regulatory market

c)

Reformatory and non-reformatory market

d)

Controlled and uncontrolled Market

4.

Indian Banking with reforms after 1991 is which phase of Indian Financial System development

a)

Phase 1

b)

Phase 2

c)

Phase 3

d)

Phase 10

5.

Which is/are the characteristic of Financial Instruments

a)

Liquidity

b)

Transferability

c)

Maturity period

d)

All of these

6.

Source of providing funds for a particular activity is called

a)

Finance

b)

Business

c)

Management

d)

Economics

7.

Indian Financial System is a link between

a)

Borrowers and seekers of fund

b)

Bank and agent

c)

Businessman and RBI

d)

Insurance and banking

8.

True or False. Economic Development refers to how advanced an economy is.

a)

True

b)

False

9.

A farmer would fall under which economic activity?

a)

Quaternary

b)

Tertiary

c)

Secondary

d)

Primary

10.

A bank is a financial institution that offers both individuals and businesses a wide range of services to help them manage their money.

a)

True

b)

False

11.

Money market deals with _____ instruments.

a)

Long term

b)

Medium term

c)

Short term

d)

All of the above

12.

Nifty is the index of _______.

a)

BSE

b)

NSE

c)

OTCEI

d)

CSE

13.

A financial security that generally has a longer

term than a bill, but a shorter term than a

bond.

a)

Notes

b)

Bills

c)

Stocks

d)

Bonds

14.

Savings certificate entitling the bearer to

receive interest.

a)

Certificate of Ownership

b)

Certificate of Deposit

c)

Savings Certificate

d)

Certificate of Recognition

15.

A short term debt obligation backed by govt.

with a maturity of less than 1 year.

a)

Treasury Bill

b)

Bills of Payment

c)

Certificate of Savings

d)

Certificate of Ownership

16.

A short term debt instrument issued by a firm

that is guaranteed by a commercial bank.

a)

Pre need Plan

b)

Life Insurance Plan

c)

Banker's Acceptance

d)

Treasury Bills

17.

Which of the following is NOT a benefit of using a check:

a)

Proof of Payment

b)

Delayed Deduction

c)

Ease of Tracking

d)

Debit Card Backup

18.

Process where a paycheck is automatically deposited into your checking account.

a)

Electronic Deposit

b)

Manual Deposit

c)

Direct Deposit

d)

Check Cashing

19.
What is the other name for "fixed deposit"?
a)
Demand deposit
b)
Current account
c)
Time deposit
d)
Deposit account
20.

What is the purpose of a bank? (You can choose more than one response on this one!)

a)

hold your money

b)

help you borrow money

c)

pay you for using your money to help others

d)

help you save your money

21.

What are Federal Reserve Banks?

a)

banks that make reservations for restaurants in your area

b)

places that print dollars

c)

places that make coins

d)

banks that store money so that they can ship it to other banks that need it when they are running low

22.

Which among the following is/are correct regarding Money Market?

a)

Money Market is a market for short-term funds

b)

Maturity in this market ranging from overnight to one year

c)

The basic function of money market is to provide efficient liquidity position for commercial banks, financial institution, Mutual funds, insurance companies, corporate etc

d)

Maturity in this market is above one year

23.

What is the maximum duration for which term money can be lent/borrowed?

a)

1 day

b)

15 days

c)

30 days

d)

1 year

24.

The issuing authority of coins in India is (a)  

25.

Money market is use for.......................purpose

a)

Short Term

b)

Long Term

c)

Security

d)

stock

26.

Who issues treasury bills( T-bills) in India

a)

RBI

b)

SBI

c)

Govt. of India

d)

all of above

27.

Which among the following helps RBI to manage liquidity conditions in the economy with banks having an avenue to surplus funds or avail funds?

a)

Repos

b)

Reverse repos

c)

Money market Mutual Funds

d)

SLR

28.

Which among the following coined the term ” Second generation Reforms” ?

a)

World Bank

b)

International Monetary Fund

c)

Reserve bank of India

d)

SBI

29.

Commercial bills market is a part of

a)

organised money market

b)

unorganised money market

c)

stock market

d)

capital market

e)

None of the above

30.

Gilt-edged market deals in:

a)

Worn currency notes

b)

Bullion and Gold

c)

Govt. securities

d)

Corporate bonds

31.

When failure of the financial system affects other systems such as insurance market or forex market, such risk is:

a)

Liquidity Risk

b)

Settlement Risk

c)

Systemic Risk

d)

Clearing Process Risk

e)

Systematic Risk

32.

The process in which the electronic holding of share replaces the paper securities:

a)

Demutualisation

b)

Rematerialisation

c)

Electronic Shares

d)

Dematerialisation

33.

The market for short term financial assets/ instruments, that are close substitutes of money, is called:

a)

Money Market

b)

Capital Market

c)

Forex Market

d)

Financial Market

34.

Which among the following is/are correct regarding Money Market?

a)

Money Market is a market for short-term funds

b)

Maturity in this market ranging from overnight to one year

c)

The basic function of money market is to provide efficient liquidity position for commercial banks, financial institution, Mutual funds, insurance companies, corporate etc

d)

Maturity in this market is above one year

35.

T-Bills are issued for =======days.

a)

182

b)

14

c)

364

d)

All of the above

36.

What is the example of commercial paper?

a)

Promissory Notes

b)

Drafts

c)

Cheque

d)

Certificate of Deposit

e)

All of the above

37.

Which of the following is not the example of financial Institution?

a)

RBI

b)

Commercial banks

c)

Cooperate Banks

d)

None f the Above

38.

Certificate of deposits in Indian Money Market emerged in--

a)

1989

b)

1990

c)

1988

d)

1995

39.

What is/are the special characteristics of Indian Money Market?

a)

Dichotomy

b)

Seasonal Variation

c)

Inter-call money market

d)

all are correct

40.

When RBI introduced the Deregulation of Interest rates?

a)

1988

b)

1990

c)

1993

d)

1999

41.

Bill Market Scheme was launched in-----

a)

1953

b)

1952

c)

1988

d)

1950

42.

The New Bill Market Scheme was launched in ----

a)

1995

b)

1975

c)

1970

d)

2000

43.

Capital Market is a market for

a)

long term assets

b)

short term assets

c)

Medium term assets

d)

none of the above

44.
Why do companies issue stocks?
a)
To create and investment opportunity into other businesses.
b)
To increase employee cooperation and an operating level.
c)
To be traded individually
d)
To raise money for economic investment and to fund operating costs.
45.
What is an IPO?
a)
Initial Polling Office
b)
Initial Public Offering
c)
International Public Office
d)
Increasing Public Opportunity
46.
What is a financial institution?
a)
A firm that makes money off of selling products
b)
An intermediary that helps channel savings into economic investments
c)
A corporation that typically falls into debt
d)
A primary source of selling company investment strategy
47.

The primary market is also called

a)

New issue market

b)

IPo

c)

stock exchange

d)

over the counter market

48.

The return of a share holder is

a)

Rate of interest

b)

Dividend

c)

Discount rate

d)

Discount value

49.

The instrument used in capital market is

a)

Equity

b)

Commercial paper

c)

Treasury Bill

d)

All the above

50.

Statutory body governing the capital market

a)

Commercial Banks

b)

RBI

c)

SEBI

d)

IDBI

51.

Professional independent brokers are called------------------

a)

Broker

b)

Hedger

c)

Jobber

d)

Budlawalas

52.

Finance companies raise funds in the money market by selling

a)

commercial paper

b)

federal funds

c)

negotiable certificates of deposits

d)

Eurodollars

53.

Compared to money market securities, capital market securities have

a)

more liquidity

b)

longer maturity

c)

lower yields

d)

less risk

54.

Makes goods or provides services

a)

Demand

b)

Producer

c)

Consumer

d)

Wants

55.

Who claims on profit first ?

a)

Equity Share holders

b)

Preference share holders

c)

both

d)

none of the above

56.

CRISIL was established in ----

a)

1992

b)

1995

c)

1988

d)

1952

57.

For transaction in security market PAN has been made mandatory since ------

a)

2005

b)

2007

c)

2002

d)

2000

58.
What are stocks?
a)
Shares of ownership in a corporation.
b)
Shares of trading in a corporation.
c)
Bonds with potential to make money.
d)
Bonds that are traded.
59.
Who buys stock at an IPO?
a)
Investment bankers
b)
Individuals
c)
Corporations
d)
Small businesses
60.
What do investment bankers do after their purchase at an IPO?
a)
Hold onto it long term
b)
Sell it to their families
c)
Sell it to their best customers
d)
Hold onto it until the next IPO
61.
Define personal investment
a)
Investing in a friend's business
b)
Buying a house
c)
Buying goods and services at a good price
d)
Putting away money hoping to make money off of it in the long term
62.
What are bonds?
a)
Certificates of indebtedness
b)
Shares of publicly traded companies
c)
Bailing people out of tough situations
d)
Certificates of profit