This quiz works best with JavaScript enabled. Home > Economics > Finance > Markets > Financial Markets – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Markets Quiz 3 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Type of financial security which have linked payoff to another issued security is classified as A) Payable security. B) Derivative security. C) Linked security. D) Non-issuing security. Show Answer Correct Answer: B) Derivative security. 2. What is defined as the degree to which an asset can be converted into cash? A) Credit. B) Liquidity. C) Debt. D) Swap rate. Show Answer Correct Answer: B) Liquidity. 3. Money market deals with ..... instruments. A) Long term. B) Medium term. C) Short term. D) All of the above. Show Answer Correct Answer: C) Short term. 4. It is an organized secondary market where securities like shares, debentures of public companies, government securities and bonds A) NYSE. B) Stock Exchange. C) Stock market. D) PSE. Show Answer Correct Answer: B) Stock Exchange. 5. When the value of the British pound changes from $ 1.50 to $ 1.25, the pound has ..... and the dollar has ..... A) Depreciated; depreciated. B) Appreciated; appreciated. C) Depreciated; appreciated. D) Appreciated; depreciated. Show Answer Correct Answer: C) Depreciated; appreciated. 6. Money market deals in ..... securities. A) Short-term. B) Long-term. C) Short-term and long-term. D) Mid-term. Show Answer Correct Answer: A) Short-term. 7. Which tends to be riskier, stocks or bonds? A) Stocks. B) Bonds. C) Neither are risky. D) Both are equally risky. Show Answer Correct Answer: A) Stocks. 8. Money market securities have all the following characteristics except they are not A) Very liquid. B) Low risk. C) Short term. D) Money. Show Answer Correct Answer: D) Money. 9. ..... a market in which financial capital is loaned and/or borrowed for at least one year A) Secondary market. B) Capital market. C) Primary market. D) Financial system. Show Answer Correct Answer: B) Capital market. 10. A company that accepts deposits, makes loans, pays interest to depositors, and pays dividends to its owners. A) Savings institution. B) Commercial banks. C) Savings & Loan Association. D) Pension fund. Show Answer Correct Answer: B) Commercial banks. 11. What is the present value of investment today in order to generate an annuity of $ 1, 000 per year in 4 years, with the first payment due today, at an interest rate of 12%? A) $ 4, 604.78. B) $ 3, 037.35. C) $ 3, 401.83. D) $ 3, 401.83. Show Answer Correct Answer: C) $ 3, 401.83. 12. In the UK, the Bank of England and the Financial Conduct Authority (FCA) are responsible for regulating financial markets. A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 13. A market that gives companies a way to raise needed capital and gives investors an opportunity for gain by allowing those companies' stock shares to be traded A) Over-the-counter Market. B) Auction Market. C) Debt Market. D) Equity Market. Show Answer Correct Answer: D) Equity Market. 14. When it comes to investments in general, the higher the ..... the higher the potential reward. A) Damage. B) Risk. C) Cost. D) Security. Show Answer Correct Answer: B) Risk. 15. WHAT IS THE FULL FORM OF ' DE-MAT ACCOUNT A) DEMATURITY ACCOUNT. B) DE-MONETARY ACCOUNT. C) DEMATERIALISED ACCOUNT. D) NONE OF THE ABOVE. Show Answer Correct Answer: C) DEMATERIALISED ACCOUNT. 16. Funds that collect and invest income until payments are made to eligible (retired) people are known as A) Bear markets. B) Bull markets. C) Mutual funds. D) Pension funds. Show Answer Correct Answer: D) Pension funds. 17. Which of the following is NOT a soft commodity? A) Copper. B) Corn. C) Feeder cattle. D) Ethanol. Show Answer Correct Answer: A) Copper. 18. Which is not a function of the Foreign Exchange Market A) Convert the Currency. B) Law implication. C) Provide Insurance. D) None of above. Show Answer Correct Answer: B) Law implication. 19. The Jamaica meeting revised the IMF's Articles of Agreement include ..... A) Gold was declared as a reserve asset. B) Fixed rates were declared acceptable. C) Floating rates were declared acceptable. D) None of above. Show Answer Correct Answer: C) Floating rates were declared acceptable. 20. A capital market is ideal when: A) Financial institutions are sufficiently developed. B) Finance is available at a reasonable cost. C) Capital is most productively allocated. D) All of these. Show Answer Correct Answer: D) All of these. 21. Stocks or shares that are sold to investors without transacting through financial institutions are classified as A) Pension transfer. B) Direct transfer. C) Global transfer. D) Indirect transfer. Show Answer Correct Answer: B) Direct transfer. 22. ..... is a part of money market. A) Preference share. B) Debentures. C) Commercial Bill. D) Equity share. Show Answer Correct Answer: C) Commercial Bill. 23. Which of the following financial assets might be most likely to have an active secondary market? A) Common stock of a large firm. B) Bonds of a major, multinational corporation. C) Bank loans made to smaller firms. D) Debt issued by the U.S. Treasury. Show Answer Correct Answer: D) Debt issued by the U.S. Treasury. 24. Which one is NOT a method of floatation in Primary market A) Issue of Forfeited shares. B) Rights issue. C) Offer for sale. D) Offer through prospectus. Show Answer Correct Answer: A) Issue of Forfeited shares. 25. OTCEI was started on the lines of: A) NASDAQ. B) NASAQ. C) NSE. D) NYSE. Show Answer Correct Answer: A) NASDAQ. 26. A forward exchange occurs when two parties agree to exchange currency and execute the deal at some specific date in the future. A) Past. B) Present. C) Future. D) None of above. Show Answer Correct Answer: C) Future. 27. ..... formal contract to repay borrowed money and interest on the borrowed money at regular future intervals A) Futures contract. B) Savings. C) Equities. D) Bond. Show Answer Correct Answer: D) Bond. 28. Date when Manila Stock Exchange established A) August 12, 1927. B) August 21, 1927. C) December 25, 1992. D) December 23, 1992. Show Answer Correct Answer: A) August 12, 1927. 29. WHICH OF THE FOLLOWING STATEMENT IS NOT RELATED TO PRIMARY MARKET A) IT HAS A PARTICULAR PLACE. B) IT IS RELATED WITH NEW ISSUE MARKET. C) IT HAS VARIOUS METHODS OF FLOAT CAPITAL LIKE PUBLIC ISSUE, PRIVATE PLACEMENT ETC. D) ALL OF THE ABOVE STATEMENTS IS RELATED WITH PRIMARY MARKET. Show Answer Correct Answer: A) IT HAS A PARTICULAR PLACE. 30. NAME THE INDEX OF OF NATIONAL STOCK EXCHANGE A) SENSEX. B) NIFTY. C) NIKKEI. D) NIKKEI. Show Answer Correct Answer: B) NIFTY. ← PreviousNext →Related QuizzesFinance QuizzesEconomics QuizzesFinancial Markets Quiz 1Financial Markets Quiz 2Financial Markets Quiz 4Financial Markets Quiz 5Financial Markets Quiz 6Financial Markets Quiz 7Financial Markets Quiz 8Financial Markets Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books