General Awareness Quiz on Financial Terminology- 30th December 2020

Q1.Define commercial paper-
(a)A certificate issued by a bank to a person depositing money for a specified length of time at a specified rate of interest.
(b)A plastic payment card that can be used instead of cash when making purchases
(c)A written order to a person requiring them to make a specified payment to the signatory or to a named payee; a promissory note.
(d)An unsecured promissory note with a fixed maturity of rarely more than 270 days.
(e)All of the above

Q2.What is a Bill of exchange?
(a)A certificate issued by a bank to a person depositing money for a specified length of time at a specified rate of interest.
(b)A plastic payment card that can be used instead of cash when making purchases
(c)A written order to a person requiring them to make a specified payment to the signatory or to a named payee; a promissory note.
(d)An unsecured promissory note with a fixed maturity of rarely more than 270 days.
(e)All of the above

Q3.The money market is-
(a)Encompasses the trade in both stocks and bonds.
(b)A document that orders a bank to pay a specific amount of money from a person’s account to the person in whose name the cheque has been issued.
(c)The trade in short-term debt.
(d)An automated kiosk where in customer can print there passbook on their own.
(e)The trade across countries.

Q4.What is Call Money?
(a)It portrays a short term loan with maturities term starting from one day to fourteen days, and it can be repaid on demand.
(b)It is the oldest and traditional money market instruments and practised across the globe.
(c)It is an agreement that specifies the sale and purchase of an asset.
(d)In this two parties sign an agreement, where one decides to pay a fixed rate of interest, and the other pay a floating rate of interest.
(e)All of the above

Q5.MMID is a number allotted by your Bank for receiving funds through IMPS. what is the full form of MMID?
(a)Money mobile identity number
(b)Mobile money identity number
(c)Magnetic money identifier
(d)Make mobile identify
(e)Mobile money identification number

Q6.What is a stock exchange?
(a)The process of recording financial transactions pertaining to a business
(b)A marketplace for the buying and selling of shares, bonds and securities
(c)Composition of systems, institutions, procedures, social relations or infrastructures whereby parties engage in exchange.
(d)A process of dividing a heterogeneous market into relatively more homogenous segments based on certain parameters
(e)All of the above

Q7.What is capital account?
(a)A systematic statement of all economic transactions of a country with the rest of the world during a specific period usually one year.
(b)Reveals the financial and economic status of a country.
(c) It shows export and import of visibles (also called merchandise or goods – represent trade balance) and invisible.
(d)It shows a capital expenditure and income for a country.
(e)It indicates whether the country has a surplus or a deficit on trade.

Q8.Define Financial Market-
(a)A market form wherein a market or industry is dominated by a small group of large sellers.
(b)A market structure where competition is at its greatest possible level
(c)A market in which people trade financial securities and derivatives at low transaction costs.
(d)An economic system in which the decisions regarding investment, production and distribution are guided by the price signals created by the forces of supply and demand.
(e)All of the above

Q9.Define Letter of credit-
(a)A letter issued by a bank to another bank (especially one in a different country) to serve as a guarantee for payments made to a specified person under specified conditions.
(b)A document that orders a bank to pay a specific amount of money from a person’s account to the person in whose name the cheque has been issued.
(c)An unsecured promissory note with a fixed maturity of rarely more than 270 days.
(d)A certificate issued by a bank to a person depositing money for a specified length of time at a specified rate of interest.
(e)All of the above

Q10.Wholesale Price Index refers to-
(a)A statistic composite index of life expectancy, education and per capita income indicators
(b)An index measures changes in the price level of a weighted average market basket of consumer goods and services purchased by households
(c)An index that measures the average changes in prices received by domestic producers for their output
(d)An index that measures and tracks the changes in the price of goods in the stages before the retail level.
(e)All of the above

Q11.Define Deflation-
(a)A decrease in the general price level of goods and services.
(b)A general rise in the price level in an economy over a period of time
(c)A situation in which the inflation rate is high,
(d)A very high and typically accelerating inflation.
(e)All of the above

Q12.What is the meaning of Paid up capital?
(a)Difference between a bank’s assets and its liabilities.
(b)Amount of money for which shares of the Company were issued to the shareholders and payment was made by the shareholders.
(c)The ratio of a bank’s capital in relation to its risk-weighted assets and current liabilities
(d)Both(a)&(b)
(e)Both(b)&(c)

Q13.What do you mean by National Income?
(a)It is an annual financial statement of income (receipts) and spending (expenditure) of the
government for a particular financial year.
(b)It is the total money value of goods and services produced by a country in a particular period of time.
(c)It is the income derived from factors of production such as Land, Labour, Capital and Entrepreneurship.
(d)It is the total income received by all sectors of an economy within a state
(e)It is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms.

Q14.What is full form of CTS?
(a)cash transaction system
(b)cheque transaction system
(c)cheque truncation system
(d)cash truncation system
(e)cheque transfer system

Q15.Define Debit card-
(a) An electronic card that let customers to access funds in deposit accounts or make purchases against a line of credit
(b)Is a payment card or dedicated payment card issued by any financial institution which enables a customer to access their accounts
(c)Electronic card of a customer’s personal account that gives the ability to make card payments or withdraw cash from an ATM
(d)Is a payment card or issued by any financial institution which enables a customer to access their purchases
(e)None of the above

Solutions

S1.Ans.(d)
Sol.A commercial paper is an unsecured promissory note with a fixed maturity of rarely more than 270 days.

S2.Ans.(c)
Sol.A Bill of exchange is a written order to a person requiring them to make a specified payment to the signatory or to a named payee; a promissory note.

S3.Ans.(c)
Sol.The money market is the trade in short-term debt.

S4.Ans.(a)
Sol.It portrays a short term loan with maturities term starting from one day to fourteen days, and it can be repaid on demand.

S5.Ans.(e)
Sol.Mobile money identification(MMID) is a number allotted by your Bank for receiving funds through IMPS.

S6.Ans.(b)
Sol.A stock exchange is a marketplace for the buying and selling of shares, bonds and securities.

S7.Ans.(d)
Sol.Capital account can be regarded as one of the primary components of the balance of payments of a nation. It gives a summary of the capital expenditure and income for a country.

S8.Ans.(c)
Sol.A financial market is a market in which people trade financial securities and derivatives at low transaction costs.

S9.Ans.(a)
Sol.A Letter of credit is a letter issued by a bank to another bank (especially one in a different country) to serve as a guarantee for payments made to a specified person under specified conditions.

S10.Ans.(d)
Sol.Wholesale Price Index refers to an index that measures and tracks the changes in the price of goods in the stages before the retail level.

S11.Ans.(a)
Sol.Deflation is a decrease in the general price level of goods and services.

S12.Ans.(b)
Sol.Paid up capital is the amount of money for which shares of the Company were issued to the shareholders and payment was made by the shareholders.

S13.Ans.(b)
Sol.National income is the total money value of goods and services produced by a country in a particular period of time.

S14.Ans.(c)
Sol.Full form of CTS is cheque truncation system.

S15.Ans.(c)
Sol.Debit card an electronic card of a customer’s personal account that gives the ability to make card payments or withdraw cash from an ATM.