Introduction to Financial Markets Additional One Mark Online Test

Introduction to Financial Markets Additional One Mark Online Test (12th Standard Commerce)

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Who defined a financial market as "the place where people and organizations wanting to borrow money are brought together with those having surplus funds"?

A.Henry Fayol B.Brigham, Eugene F C.F.W. Taylor D.Peter F. Drucker

Which one of the following belongs to the unorganized sector of the Indian financial system?

A.Regulators B.Financial Institutions C.Indigenous Bankers D.Financial Services

Which of the following is an example of a money market instrument?

A.Equity shares B.Treasury Bills C.Debentures D.Preference shares

On the basis of the type of financial claim, the market for trading in Government Bonds and Corporate Debentures is called the

A.Equity Market B.Debt Market C.Spot Market D.Over-the-Counter Market

Consider the following statements about the primary market:
1) It includes all institutions involved in the sale of securities for the first time by the issuers.
2) The money from investors goes directly to the issuers.
3) The stock exchange is its most important institution.
Which of the statements given above is/are correct?

A.1 only B.1 and 2 only C.2 and 3 only D.1, 2 and 3

A decentralized market, outside the stock exchange, with customized procedures is known as the

A.Exchange Traded Market B.Over-the-Counter Market C.Primary Market D.Cash Market

In which market do the delivery of the asset and the payment of cash take place at a pre-determined time frame in the future?

A.Cash market B.Spot market C.Forward or Futures market D.Equity market

Match the basis of classification with the pair of markets:
A) Type of financial claim - 1) Money market and Capital market
B) Maturity of financial claim - 2) Cash market and Futures market
C) Time of issue of financial claim - 3) Debt market and Equity market
D) Timing of delivery of financial claim - 4) Primary market and Secondary market

A.A-3, B-1, C-4, D-2 B.A-1, B-3, C-2, D-4 C.A-3, B-4, C-1, D-2 D.A-4, B-1, C-3, D-2

Assertion (A): One financial market may come under more than one category.
Reason (R): The classification of financial markets is not rigid.

A.Both A and R are true and R is the correct explanation of A B.Both A and R are true but R is not the correct explanation of A C.A is true but R is false D.A is false but R is true

Q10

Obtaining funds from surplus units such as household individuals, business firms, public sector units and Government is the role of financial markets known as

A.Savings Mobilization B.Investment C.Industrial Development D.Entrepreneurship Growth

Q11

Financial markets contribute to a nation's growth by ensuring an unfettered flow of surplus funds to deficit units. This role is called

A.Savings Mobilization B.National Growth C.Entrepreneurship Growth D.Capital Formation

Q12

Financial markets contribute to the development of the entrepreneurial class by

A.Fixing the price of goods B.Making available the necessary financial resources C.Recruiting skilled workers for them D.Reducing the tax on their income

Q13

Which intermediary function of financial markets provides a channel through which new savings flow to aid the capital formation of a country?

A.Transfer of Resources B.Enhancing Income C.Capital Formation D.Sale Mechanism

Q14

Financial markets determine the price of traded financial assets through the interaction of buyers and sellers. This mechanism is called

A.Price discovery process B.Sale mechanism C.Productive usage D.Savings mobilization

Q15

Which one of the following is a financial function, and not an intermediary function, of a financial market?

A.Transfer of resources from lenders to ultimate borrowers B.Dissemination of information to the various segments of the market C.Providing liquidity in the market so as to facilitate trading of funds D.Providing a mechanism for selling a financial asset

Q16

The information function of financial markets helps to

A.Reduce the cost of transaction of financial assets B.Fix the price of new shares C.Increase the tax revenue of the Government D.Remove the need for intermediaries

Q17

In the New Issue Market, the intermediaries are

A.Brokers B.Underwriters C.Money lenders D.Indigenous bankers

Q18

Consider the following statements comparing the two markets:
1) In the New Issue Market securities are sold at a fixed price.
2) The Secondary Market has a physical existence.
3) The Secondary Market provides funds to companies for expansion and diversification.
Which of the statements given above is/are correct?

A.1 only B.1 and 2 only C.2 and 3 only D.1, 2 and 3

Q19

Find the odd one out with respect to marketable assets.

A.Shares of listed companies B.Government securities C.Bonds of public sector undertakings D.National Savings Certificates

Q20

According to the box on financial assets, a building bought for hiring becomes

A.A physical asset B.A financial asset C.A non-marketable asset D.A consumption asset

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About this Introduction to Financial Markets test

This free online practice test covers Introduction to Financial Markets from the 12th Standard Commerce (Samacheer Kalvi) syllabus. Choose the number of questions and an optional time limit, then answer and submit — everything is checked in your browser, with the correct answers and a worked explanation shown at the end. For the full solutions to every question in this set, see the solved MCQs page.

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