1.

Warrants are combination of (Equity & Call)

2. US Patriot act was introduced in which year? (an : 2001)

3. Bankers Bank- Central bank

4. A hedge fund is an investment fund open to a limited range of investors that

undertakes a wider range of investment

5. Processing cycle for LC (letter of credit) (an : 3,4,2,5,1)

6. sequence for trade cycle

Trade matching, trade execution, trade clearing, trade settlement

7. SPV : Special Purpose Vehicle

8. BAFT : bankers association for foreign trade
9. OTC : Over the Counter
10. TARP: Trouble Asset Relief Program
11. PIC : Personal Investment Companies
12. CIP : Customer Identification Program
13. CP : Commercial Paper
14. CPI : Consumer price index
15. ADR : American Depository Receipt
16. CRR : Cash Reserve Ratio
17. IPO : Initial Public Offering

18. The standby LC can remain valid for years. It eliminates the cost of separate
LCs for each transaction with a regular client (An : Evergreen Clause)

19. Yankee bonds are also called? An: junk bonds

20. Eliminates both country risk and commercial risk? (an : Stand by LC and
LC)

21. Fastest method for calculating VaR (an : variance-covariance method)

22. Which risk may bring both gain as well as loss? an: Interest rate risk and
foreign exchange risk

23. price of share of one company falls then which risk (an : market risk)

24. interest rate decreases then bond price increases

25. Treasury management System? an: Front Arena

26. Trade finance helps in facilitating international transactions

27. Which is true? - Wire transfer is more costly than other payment
alternatives
28. Security with maturity less than one year is traded on money market. (an :
True)

29. Currency is also called (an : store of value)

30. Which of the following is usually not participant in stock market

a. Small individuals investors
b. Central banks
c. Companies
d. Financial institutions
31. If an investment pays interest at an annual rate of 5% per year,
compounded twice a year than the effective yield larger than 5.5%
a. True b. False
32. In an account saving simple interest from the first year is reinvented
at the beginning of the second year?
a. True b. False

33. Which of the following is a not current asset?

a. Goods for sale inventory
b. Terms loans
c. Cash
d. Raw material inventory
e. Receivables

34. Which of the following in not a feature of private banking?

a. Specialist advice
b. Lot of research
c. Commercial lending
d. High investment in technology
e. Understanding the capital and investment needs.

35. Retail loans are asset product offered by the bank

a. True b. False

36. If the price of share pf cognizant changes from 65 to 60 this can be

attributed to:
a. Market risk
b. Interest rate risk
c. Credit risk
d. Operational risk
e. Liquidity risk

37. Which of the following is not the settlement method for bank loans?
a. Pre-closure
b. Assignment
c. Participation
d. Sub participation
e. Securities repository
38. The purchase of any stock for immediate delivery is a __ market
transaction.
a. Futures
b. Spot
c. Forward
d. Stock
e. Option

39. In the historical simulation method of VaR calculation:

a. Return are assumed to be not normally distributed
b. No assumption is made about the distribution
c. Random returns are generated to calculate VaR
d. Return are assumed to be normally distributed
e. Returns are not required at all.

40. What happens when interest rate fall:

a. Bond prices increase

b. Bond prices decrease
c. Bond prices do not change
d. Economy goes into deflation
e. Interest rate never fall, they always go up.

41. If the price of a security on day 1&2 is $102 and $100 respectively.
The return is

a. -2%
b. 2%
c. -1.96%
d. Very high
e. 1-2%

42. If you invest $1000 for 3 years at 7% compound interest, how much
will you have at the end of the 3 years?

a. $1225
b. None of listed option
c. $1000
d. $1070
e. $1270
43. What is need for banks in the society?

a. Small investor are protected, hence it is a low risk investment avenue.

b. Banks are in the best position to lend out money at competitive
c. Depositors are participant in primary and secondary markets.
d. All of listed options.

44. A is more risk averse investor than B .therefore.

a. For the same return, B tolerates lesser risk than B.

b. For the same return, A tolerates higher rate of return.
c. For the same return, A tolerates lower rate of return.
d. For the same return, A takes higher risk.

45. Liquidity issues of credit can be addressed by:-

a. Sweep facility
b. Structured lending to client
c. All
d. Short term credit facilities
e. Overdraft

46. Which is associated with purpose of regulating financial institution?

a. None
b. To provide stability of money supply.
c. To serve certain social objectives.
d. To prevent failure of any financial institution.
e. To offset moral hazard incentive provided by deposit insurance and
other guarantees.

47. Fastest method for calculating VaR.

a. Monte- Carlo simulation.

b. All equal time with software.
c. Variance-Covariance matrix.
d. Combination of Monte- Carlo and Historical Simulation.

48. Which is not banks primary use for deposits?

a. Payment to employers
b. None
c. Investment
d. Loan
e. Withdrawal
 49. If the corporate isnt able to raise money from the market to pay off
some loans the risk can be refer.

a. Market risk
b. Interest rate risk
c. Commodity risk
d. Operational risk
e. Liquidity risk
50. On the trading day at the NYSE a broker undertakes the following
trades

Buy 100 IBM shares for $10.00 each

Sell 50 IBM shares for $10.50 each

Buy 100 MFST share for $20.00 each

Sell 20 IBM shares $11 each

Sell 10 MFST share at 20.50 each

Sell 30 IBM shares for 9.00 each

How much did the broker pay out to the exchange in total in case of (i)
Gross settlement system (ii) Net Settlement System?

a. (i) $1780 (ii) $3000

b. (i) 0 for IBM, $1795 for MSFT (ii) $1780.

c. (i) $3000 (ii) $1780

d. None

e. (i) $1780 (ii) 0 for IBM, $1795 for MSFT

51. Which of the following is not a core private banking function?

A) Client management

B) Deposit Mobilization

C) Investment analysis and advice

D) Research

E) Sales and Marketing

52. Which of the following methods of payment is most risky to the Seller?

a. Counter trade

b. Open Account

c. Cash in Advanced.

d. Letter of Credit

e. Documentary Collection

53. 3Cs --- Credit, Capacity and Collateral

54. A bank decides to sanction only 10% of the loan sought by a company. The company goes and
pledges extra assets with the bank and the bank then agrees to sanction 50% of the loan sought.
The company has indulged in the process of:

A. Credit Revision b. Credit Increase c. Credit scoring

d. Credit Enhancement e. Credit Incrementation

55. Which of the following represents the correct hierarchy of corporate ratings (highest to lowest)?

a. AAA, AA+, BBB, D b. AAA, AA-, D, BBB c. D,C,B,A

d. D, AA-, B, AAA e. AAA, AA+, D, AA-

56. The Brokerage firms are regulated by

a. State regulatory agencies b. Industry wide SROs c. SEC d. All of the listed options

57. In a 2 way quote for a share the bid is

A. more than offer b. equal to offer c. less than offer

d. 2% less than offer e. dependent on dealer's skill