General Awareness Quiz for SSC, Railway, Banking, Defence

General Awareness Quiz on Most Important Banking Term: Jan 2021

Q1. Commercial paper can be issued for a maximum period of:

(a)3 months
(b)2 years
(c)6 months
(d)365 days or 1 year
(e)140 days

View Answer

S1.Ans(d)
Sol.
Commercial paper can be issued for a maximum period of 1 year or 365 days.


Q2. Who regulates the money market in India?

(a)Reserve Bank of India
(b)Securities and Exchange Board of India (SEBI)
(c)Commercial Banks
(d)Pension Fund Regulatory and Development Authority
(e)Both A & B

View Answer

S2.Ans(e)
Sol.
RBI & SEBI regulates the money market in India


Q3. Who is eligible to invest in Commercial Papers (CPs):

(a)Individuals, corporate bodies
(b)banking companies
(c)Non-Resident Indians (NRIs)
(d)Foreign Institutional Institutions (FIIs)
(e)All of the above

View Answer

S3.Ans(e)
Sol.
Individuals, corporate bodies (either registered or incorporated in India), banking companies, unincorporated bodies, Non-Resident Indians (NRIs) and Foreign Institutional Institutions (FIIs) can invest in CPs.


Q4. Certificate of Deposit (CD) is an _____ instrument.

(a)Demand deposit
(b)Long term
(c)Negotiable money market
(d)Unsecured money market
(e)None of these

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S4.Ans(c)
Sol.
Certificate of Deposit (CD) is a negotiable money market instrument and issued in dematerialised form.


Q5. Commercial Paper are linked to____.

(a)Unorganized market
(b)Money market
(c)Regulated market
(d)Government market
(e)Unorganized market

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S5.Ans(b)
Sol.
Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note.


Q6. In what denominations Commercial Paper (CP) can be issued?

(a)Rs.5 lakh
(b)Rs.10 lakh
(c)Rs.2 lakh
(d)Rs.1 lakh
(e)None of these

View Answer

S6.Ans(a)
Sol.
Commercial Paper (CP) can be issued in denominations of Rs.5 lakhs.


Q7. The negotiable Certificate of deposit are traded in?

(a)Indirect Market
(b)Direct Market
(c)Secondary Market
(d)Primary Market
(e)All of the above

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S7.Ans(c)
Sol.
The Certificate of deposit is traded in the Secondary Market.


Q8. Treasury bills (T-bills) are issued by the Government of India are ______ market instruments.

(a)Short term money
(b)Negotiable money
(c)Unsecured money
(d)Long term money
(e)None of these

View Answer

S8.Ans(a)
Sol.
Treasury bills or T-bills, which are money market instruments, are short term debt instruments issued by the Government of India.


Q9. Money lent for more than one day but less than 15 days in the money market is known as ____.

(a)Hot Money
(b)Narrow Money
(c)Term Money
(d)Notice Money
(e)Call Money

View Answer

S9.Ans(d)
Sol
. Money lends for more than one day and 14 days which is known as notice money.


Q10. The minimum amount of investment required to issue a certificate of deposit is _______.

(a)Rs. 3 lakhs
(b)Rs. 1 lakh
(c)Rs. 1.5 lakhs
(d)Rs. 5 lakhs
(e)Rs. 50,000

View Answer

S10.Ans(b)
Sol.
The minimum amount of investment should not be less than Rs. 1 lakh and in the multiples of 1 lakh thereafter.


Q11. Which of the following is not a Money Market Instrument?

(a)Certificate of Deposit
(b)Call Money
(c)T-Bills
(d)All are money market instruments
(e)None

View Answer

S11.Ans(d)
Sol.
Certificate of Deposit, T-Bills, Call Money, T-Bills all is Money Market Instrument.


Q12. Maturity period of Commercial bill varies from:

(a)60 days, 90 days or 120 days
(b)50 days, 60 days or 90 days
(c)30 days, 60 days or 90 days
(d)40 days, 50 days or 90 days
(e)None of these

View Answer

S12.Ans(c)
Sol.
Commercial Bills are issued by the seller(drawer) on the buyer (drawee) for the value of goods delivered by him. These Bills are of 30 days, 60 days or 90 days maturity.


Q13. Which of the following best describes ‘Call Money Market Operations’?

(a)Funds are transacted for 2 to 14 days
(b)Funds are transacted on an overnight basis
(c)Funds are transacted on a monthly basis
(d)Funds are transacted on a yearly basis
(e)None of the above statement

View Answer

S13.Ans(b)
Sol
. Under call money market, funds are transacted on overnight basis.


Q14. Which of the following is not a part of Money Market?

(a)Call money
(b)Term money
(c)Commercial bills
(d)Capital market
(e)None of the above

View Answer

S14.Ans(d)
Sol.
Treasury bills, repurchase agreement and commercial paper all are short term investments and have a maturity level of less than one year.


Q15. Treasury Bills are issued for how many days?

(a)80days T-Bills, 182-day T-Bills and 367-days T-Bills.
(b)70days T-Bills, 183-day T-Bills and 363-days T-Bills.
(c)14-day, 91-day, 182-day and 364-day
(d)60days T-Bills, 184-day T-Bills and 366-days T-Bills.
(e)None

View Answer

S15.Ans(c)
Sol.
Government of India issues four types of treasury bills, namely, 14-day, 91-day, 182-day and 364-day.


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