The following role of Central Bank to regulatory body for the commercial Banks
1- Central bank control the Monetary policy
2- Central bank help to maintain the interest rate on loans
3- Central bank helpful to control the inflation rates in the country
4- Central bank control the supply of money, often targeting a rate of interest
5- Central bank main goals usually include relatively stable price and low unemployment.
Showing posts with label Bank. Show all posts
Showing posts with label Bank. Show all posts
Wednesday, June 1, 2011
Saturday, February 12, 2011
BNK604 Final Term Current Paper (Feb 2011)
BNK604 Final Term Current Paper (Feb 2011)
ENRON Question
Leasing Question
Leasing Question
.............
Another Paper:
Total Question MCQs = 56
Short Question = 4 each having 3 Marks
Long Question = 4 each having 5 Marks
My Long Questions
Mutual fund
Investment Banking
ENRON
Leasing
Short Question = 4 each having 3 Marks
Long Question = 4 each having 5 Marks
My Long Questions
Mutual fund
Investment Banking
ENRON
Leasing
BNK603 Final Term Current Paper (Feb 2011)
BNK603 Final Term Current Paper (Feb 2011)
Total Question MCQs = 56
Short Question = 4 each having 3 Marks
Long Question = 4 each having 5 Marks
My Long Questions
1. Change Management in service design
2. Recovery / Collection process
3. Documentation of housing finance
4. Responsibilities of Regional Credit Administration Department
5. Alternative Face to Face Business
6. What is on demand business
*** For MCQs see whole book thoroughl
Short Question = 4 each having 3 Marks
Long Question = 4 each having 5 Marks
My Long Questions
1. Change Management in service design
2. Recovery / Collection process
3. Documentation of housing finance
4. Responsibilities of Regional Credit Administration Department
5. Alternative Face to Face Business
6. What is on demand business
*** For MCQs see whole book thoroughl
.....................
Wednesday, November 3, 2010
Mgt411 GDB No. 1 solution
Gross Domestic Product:
In economics, GDP uses for gross domestic product-the total value of all goods and services produced within that economy during a specified period.
The GDP deflator is a price index compute changes in prices of all new, nationally and internally produced, final goods and services in an economy.
The GDP deflator is not based on a fixed market basket of goods and services. The basket is allowed to change with people's consumption and investment patterns. Therefore, new expenditure patterns are allowed to show up in the deflator as people respond to changing prices.
Consumer price Index:
A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. The CPI is calculated by taking price changes for each item in the predetermined basket of goods and averaging them; the goods are weighted according to their importance. Changes in CPI are used to assess price changes associated with the cost of living.
Which is better Measure::
Although at first glance it may seem that CPI and GDP Deflator measure the same thing, there are a few key differences:
a) The first is that GDP Deflator includes only domestic goods and not anything that is imported. This is different because the CPI includes anything bought by consumers including foreign goods.
b) The second difference is that the GDP Deflator is a measure of the prices of all goods and services while the CPI is a measure of only goods bought by consumers.
In economics, GDP uses for gross domestic product-the total value of all goods and services produced within that economy during a specified period.
The GDP deflator is a price index compute changes in prices of all new, nationally and internally produced, final goods and services in an economy.
The GDP deflator is not based on a fixed market basket of goods and services. The basket is allowed to change with people's consumption and investment patterns. Therefore, new expenditure patterns are allowed to show up in the deflator as people respond to changing prices.
Consumer price Index:
A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. The CPI is calculated by taking price changes for each item in the predetermined basket of goods and averaging them; the goods are weighted according to their importance. Changes in CPI are used to assess price changes associated with the cost of living.
Which is better Measure::
Although at first glance it may seem that CPI and GDP Deflator measure the same thing, there are a few key differences:
a) The first is that GDP Deflator includes only domestic goods and not anything that is imported. This is different because the CPI includes anything bought by consumers including foreign goods.
b) The second difference is that the GDP Deflator is a measure of the prices of all goods and services while the CPI is a measure of only goods bought by consumers.
....................
Consumer price index (CPI)
1) Measure of the overall level of price used to.(2)Track change in the typical household's cost of living.(3)Survey consumers to determine comosition of the typical consumer;s "basket" of good.(4)Every month,collect data on price of all item in the basket;compute cost of basket.(5)CPI in any month equals
100 * COST OF BASKET IN THAT MONTH / COST OF BASKET IN BASE PERIOD
GDB DEFLATOR:The GDB deflator,also called the implicit price for GDB,measures the price of output relative to its price in the base year.
GDB=(NOMINAL GDB / REAL GDB)*100
1) Measure of the overall level of price used to.(2)Track change in the typical household's cost of living.(3)Survey consumers to determine comosition of the typical consumer;s "basket" of good.(4)Every month,collect data on price of all item in the basket;compute cost of basket.(5)CPI in any month equals
100 * COST OF BASKET IN THAT MONTH / COST OF BASKET IN BASE PERIOD
GDB DEFLATOR:The GDB deflator,also called the implicit price for GDB,measures the price of output relative to its price in the base year.
GDB=(NOMINAL GDB / REAL GDB)*100
BNK624 Assignment No. 1 Announced
Schedule
Opening Date and Time
November 03, 2010 At 12:01 A.M. (Mid-Night)
Opening Date and Time
November 03, 2010 At 12:01 A.M. (Mid-Night)
Due Date and Time
November 08, 2010 At 11:59 P.M. (Mid-Night)
Sunday, October 31, 2010
BNK603 Ass # 1 Idea Solution
Question 1:
Strategic Economies don’t drive from Operational Excellence, but from the business concept itself.
Strategic Economies
Unlike operational efficiencies, Strategic Economies don’t drive from Operational Excellence, but from the business concept itself. Strategic Economic come in three varieties:
1. Scale
2. Focus
3. Scope
1. Scale
Scale can derive efficiencies in many ways through:
- Better Plant Utilization
- Greater Purchasing Power
- The Muscle to enforce industry wide price discipline Industries revolutionaries often consolidate fragmented industries. Any that gets caught behind the consolidation curve and misses the chance to build Scale Advantage will be left with a notable disadvantage
2. Focus
A company with a high degree of Focus & Specialization may reap economies compared with competitors
With a more diffused Business Mission and a less coherent mix of products & services.
Focus is not about efficiency in a cost sense; it’s about in a don’t-get-distracted, get-all-the-wood-behind one-Arrow sense.
3. Scope
The idea here is almost opposite of focus. A company that can leverage resources and management talents across a broad array of opportunities may have an efficiency advantage over firms that cannot. Scope
Economies come from sharing things across business units & countries; Brands, Facilities, Best Practices,
Scare Talent, IT Infrastructure, and so on. Scope Economies come in a variety of flavors; Channel Power & access to distribution channels, Economies in buying ad space & running high-tech distribution centers.
Question 2
What kinds of challenges are being faced by the retail banking in Pakistan
Challenges to Retail Banking in Pakistan
Ø The issue of money laundering is very important in retail banking. This compels all the banks to
Ø scrutinize diligently all the documents which they accept while entering into a relationship
Ø Outsourcing has become significant in recent past because various core activities such as hardware
Ø and software maintenance, entire ATM set up and operation (including cash, refilling) etc., are
Ø being handled by outside vendors
Ø Banks are expected to take utmost care to retain the ongoing trust of the public
Ø Customer service should be at the end all in retail banking. Someone has rightly said, “It takes
Ø months to find a good customer but only seconds to lose one.” Thus, strategy of Knowing Your
Ø Customer (KYC) is important
Ø The dependency on technology has brought IT departments’ additional responsibilities and
Ø challenges in managing, maintaining and optimizing the performance of retail banking networks
Ø It is equally important that banks should maintain security to the advance level to keep the faith of
Ø the customer
Ø The efficiency of operations would provide the competitive edge for the success in retail banking in
Ø coming years
Ø The customer retention is of paramount important for the profitability of retail banking business &
Ø increase in the market share
Ø One of the crucial impediments for the growth of this sector is the shortage of manpower talent of
Ø this specific nature, a modern banking professional, for a modern banking sector
Saturday, October 30, 2010
BNK603 Assignment No. 1 solution
BNK603 assignment
Q1: Strategic economies don't drive from Operational Excellence, but from the business concept itself. Discuss
Q2:What kind of challenges are being faced by the retail banking in Pakistan?
..........
“Consumer Banking (BNK603)”
Question 1:
Strategic Economies don’t drive from Operational Excellence, but from the business concept itself.
Strategic Economies
Unlike operational efficiencies, Strategic Economies don’t drive from Operational Excellence, but from the business concept itself. Strategic Economic come in three varieties:
1. Scale
2. Focus
3. Scope
1. Scale
Scale can derive efficiencies in many ways through:
Better Plant Utilization
Greater Purchasing Power
The Muscle to enforce industry wide price discipline Industries revolutionaries often consolidate
fragmented industries. Any that gets caught behind the consolidation curve and misses the chance
to build Scale Advantage will be left with a notable disadvantage
2. Focus
A company with a high degree of Focus & Specialization may reap economies compared with competitors
with a more diffused Business Mission and a less coherent mix of products & services.
Focus is not about efficiency in a cost sense; it’s about in a don’t-get-distracted, get-all-the-wood-behindone-
arrow sense.
3. Scope
The idea here is almost opposite of focus. A company that can leverage resources and management talents
across a broad array of opportunities may have an efficiency advantage over firms that cannot. Scope
Economies come from sharing things across business units & countries; Brands, Facilities, Best Practices,
Scare Talent, IT Infrastructure, and so on. Scope Economies come in a variety of flavors; Channel Power &
access to distribution channels, Economies in buying ad space & running high-tech distribution centers.
Question 2
What kinds of challenges are being faced by the retail banking in Pakistan?
Challenges to Retail Banking in Pakistan
The issue of money laundering is very important in retail banking. This compels all the banks to
scrutinize diligently all the documents which they accept while entering into a relationship
Outsourcing has become significant in recent past because various core activities such as hardware
and software maintenance, entire ATM set up and operation (including cash, refilling) etc., are
being handled by outside vendors
Banks are expected to take utmost care to retain the ongoing trust of the public
Customer service should be at the end all in retail banking. Someone has rightly said, “It takes
months to find a good customer but only seconds to lose one.” Thus, strategy of Knowing Your
Customer (KYC) is important
The dependency on technology has brought IT departments’ additional responsibilities and
challenges in managing, maintaining and optimizing the performance of retail banking networks
It is equally important that banks should maintain security to the advance level to keep the faith of
the customer
The efficiency of operations would provide the competitive edge for the success in retail banking in
coming years
The customer retention is of paramount important for the profitability of retail banking business &
increase in the market share
One of the crucial impediments for the growth of this sector is the shortage of manpower talent of
this specific nature, a modern banking professional, for a modern banking sector
Q1: Strategic economies don't drive from Operational Excellence, but from the business concept itself. Discuss
Q2:What kind of challenges are being faced by the retail banking in Pakistan?
..........
“Consumer Banking (BNK603)”
Question 1:
Strategic Economies don’t drive from Operational Excellence, but from the business concept itself.
Strategic Economies
Unlike operational efficiencies, Strategic Economies don’t drive from Operational Excellence, but from the business concept itself. Strategic Economic come in three varieties:
1. Scale
2. Focus
3. Scope
1. Scale
Scale can derive efficiencies in many ways through:
Better Plant Utilization
Greater Purchasing Power
The Muscle to enforce industry wide price discipline Industries revolutionaries often consolidate
fragmented industries. Any that gets caught behind the consolidation curve and misses the chance
to build Scale Advantage will be left with a notable disadvantage
2. Focus
A company with a high degree of Focus & Specialization may reap economies compared with competitors
with a more diffused Business Mission and a less coherent mix of products & services.
Focus is not about efficiency in a cost sense; it’s about in a don’t-get-distracted, get-all-the-wood-behindone-
arrow sense.
3. Scope
The idea here is almost opposite of focus. A company that can leverage resources and management talents
across a broad array of opportunities may have an efficiency advantage over firms that cannot. Scope
Economies come from sharing things across business units & countries; Brands, Facilities, Best Practices,
Scare Talent, IT Infrastructure, and so on. Scope Economies come in a variety of flavors; Channel Power &
access to distribution channels, Economies in buying ad space & running high-tech distribution centers.
Question 2
What kinds of challenges are being faced by the retail banking in Pakistan?
Challenges to Retail Banking in Pakistan
The issue of money laundering is very important in retail banking. This compels all the banks to
scrutinize diligently all the documents which they accept while entering into a relationship
Outsourcing has become significant in recent past because various core activities such as hardware
and software maintenance, entire ATM set up and operation (including cash, refilling) etc., are
being handled by outside vendors
Banks are expected to take utmost care to retain the ongoing trust of the public
Customer service should be at the end all in retail banking. Someone has rightly said, “It takes
months to find a good customer but only seconds to lose one.” Thus, strategy of Knowing Your
Customer (KYC) is important
The dependency on technology has brought IT departments’ additional responsibilities and
challenges in managing, maintaining and optimizing the performance of retail banking networks
It is equally important that banks should maintain security to the advance level to keep the faith of
the customer
The efficiency of operations would provide the competitive edge for the success in retail banking in
coming years
The customer retention is of paramount important for the profitability of retail banking business &
increase in the market share
One of the crucial impediments for the growth of this sector is the shortage of manpower talent of
this specific nature, a modern banking professional, for a modern banking sector
Monday, October 25, 2010
BNK601 GDB Announcement
Semester Fall 2010
“Banking Laws & Practices (BNK601)”
This is to inform that Graded Discussion Board (GDB) will be opened according to the following schedule
Schedule:Opening Date and TimeOct 26,2010 At 12:01 AM
Closing Date and TimeOct 27,2010 At 11:59 PM
Closing Date and TimeOct 27,2010 At 11:59 PM
Topic/Area for Discussion
“Financial Instruments & differences among them”
Note: The discussion question will be from the area/topic mentioned above. So start learning about the topic now.
Sunday, August 1, 2010
Tuesday, July 20, 2010
BNK601 Current Quiz
Question # 1 of 15 ( Start time: 10:53:53 PM ) Total Marks: 1
Which of the following is NOT the essential requirement for the endorsement as per Negotiable Instrument Act, 1881?
Select correct option:
It should be on the instrument
It should be made by the holder or the maker
Signatures should be in ink and not by pencil or rubber stamp
It should contain unconditional order
Question # 2 of 15 ( Start time: 10:55:19 PM ) Total Marks: 1
All of the following are included in the financial intermediaries, EXCEPT:
Select correct option:
Mutual Funds
Pension Funds
Stock Exchange
Credit Union
Question # 3 of 15 ( Start time: 10:56:21 PM ) Total Marks: 1
Which of the following terms is NOT defined by the Companies Ordinance, 1984?
Select correct option:
Paid-up capital
Debenture
Dividend
Preference share
Question # 4 of 15 ( Start time: 10:57:53 PM ) Total Marks: 1
What is the bailment of goods as security for payment of a debt or performance of a promise called?
Select correct option:
Hypothecation
Mortgage
Lien
Pledge
Question # 5 of 15 ( Start time: 10:58:20 PM ) Total Marks: 1
According to Section 4 of State Bank of Pakistan Act, 1956, which of the following should be the original Capital of the Bank?
Select correct option:
Rs. 20 Millions
Rs. 30 Millions
Rs. 40 Millions
Rs. 50 Millions
Question # 6 of 15 ( Start time: 10:58:39 PM ) Total Marks: 1
Which of the following is NOT a legal requirement for opening a bank account of a limited company?
Select correct option:
Copy of Memorandum of Association
Copy of Articles of Association
Certificate of Incorporation
Specimen signatures of all the directors
Question # 7 of 15 ( Start time: 10:59:15 PM ) Total Marks: 1
Which of the following is also called the Legal Mortgage?
Select correct option:
Equitable Mortgage
Registered Mortgage
Un-registered Mortgage
Non-equitable Mortgage
Question # 9 of 15 ( Start time: 11:00:54 PM ) Total Marks: 1
Which of the following refers to “the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them”?
Select correct option:
Bailment
Mortgage
Lien
Pledge
Question # 10 of 15 ( Start time: 11:01:50 PM ) Total Marks: 1
According to Section 23 of Banking Companies Ordinance, 1962, a subsidiary to banking company can perform which of the following function(s)?
Select correct option:
To carry on of banking business strictly in conformity with Islam
To carry on business of modaraba
Such other purposes as are incidental to the business of banking
All of the given options
Question # 11 of 15 ( Start time: 11:02:33 PM ) Total Marks: 1
According to URR525, which of the following is a request for reimbursement from the Claiming Bank to the Reimbursing Bank?
Select correct option:
Reimbursement authorizations
Reimbursement amendment
Reimbursement claim
Reimbursement undertaking
Question # 12 of 15 ( Start time: 11:03:29 PM ) Total Marks: 1
Which of the following has defined the banker as “Any person carrying on a bonafide banking business in the United Kingdom is a banker”?
Select correct option:
American Version
United Kingdom’s Version
Finance Act, 1915
Negotiable Instruments Act, 1881
Question # 13 of 15 ( Start time: 11:04:17 PM ) Total Marks: 1
According to UCP 600, which of the following refers to any arrangement, however named or described, that is irrevocable and thereby constitutes a definite undertaking of the issuing bank to honor a complying presentation?
Select correct option:
Credit
Letter of credit
Confirmation
Honor
Question # 15 of 15 ( Start time: 11:06:03 PM ) Total Marks: 1
In which of the following years, “Wafaqi Mohtasib” was established?
Select correct option:
1983
1995
2000
2005
Which of the following is NOT the essential requirement for the endorsement as per Negotiable Instrument Act, 1881?
Select correct option:
It should be on the instrument
It should be made by the holder or the maker
Signatures should be in ink and not by pencil or rubber stamp
It should contain unconditional order
Question # 2 of 15 ( Start time: 10:55:19 PM ) Total Marks: 1
All of the following are included in the financial intermediaries, EXCEPT:
Select correct option:
Mutual Funds
Pension Funds
Stock Exchange
Credit Union
Question # 3 of 15 ( Start time: 10:56:21 PM ) Total Marks: 1
Which of the following terms is NOT defined by the Companies Ordinance, 1984?
Select correct option:
Paid-up capital
Debenture
Dividend
Preference share
Question # 4 of 15 ( Start time: 10:57:53 PM ) Total Marks: 1
What is the bailment of goods as security for payment of a debt or performance of a promise called?
Select correct option:
Hypothecation
Mortgage
Lien
Pledge
Question # 5 of 15 ( Start time: 10:58:20 PM ) Total Marks: 1
According to Section 4 of State Bank of Pakistan Act, 1956, which of the following should be the original Capital of the Bank?
Select correct option:
Rs. 20 Millions
Rs. 30 Millions
Rs. 40 Millions
Rs. 50 Millions
Question # 6 of 15 ( Start time: 10:58:39 PM ) Total Marks: 1
Which of the following is NOT a legal requirement for opening a bank account of a limited company?
Select correct option:
Copy of Memorandum of Association
Copy of Articles of Association
Certificate of Incorporation
Specimen signatures of all the directors
Question # 7 of 15 ( Start time: 10:59:15 PM ) Total Marks: 1
Which of the following is also called the Legal Mortgage?
Select correct option:
Equitable Mortgage
Registered Mortgage
Un-registered Mortgage
Non-equitable Mortgage
Question # 9 of 15 ( Start time: 11:00:54 PM ) Total Marks: 1
Which of the following refers to “the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them”?
Select correct option:
Bailment
Mortgage
Lien
Pledge
Question # 10 of 15 ( Start time: 11:01:50 PM ) Total Marks: 1
According to Section 23 of Banking Companies Ordinance, 1962, a subsidiary to banking company can perform which of the following function(s)?
Select correct option:
To carry on of banking business strictly in conformity with Islam
To carry on business of modaraba
Such other purposes as are incidental to the business of banking
All of the given options
Question # 11 of 15 ( Start time: 11:02:33 PM ) Total Marks: 1
According to URR525, which of the following is a request for reimbursement from the Claiming Bank to the Reimbursing Bank?
Select correct option:
Reimbursement authorizations
Reimbursement amendment
Reimbursement claim
Reimbursement undertaking
Question # 12 of 15 ( Start time: 11:03:29 PM ) Total Marks: 1
Which of the following has defined the banker as “Any person carrying on a bonafide banking business in the United Kingdom is a banker”?
Select correct option:
American Version
United Kingdom’s Version
Finance Act, 1915
Negotiable Instruments Act, 1881
Question # 13 of 15 ( Start time: 11:04:17 PM ) Total Marks: 1
According to UCP 600, which of the following refers to any arrangement, however named or described, that is irrevocable and thereby constitutes a definite undertaking of the issuing bank to honor a complying presentation?
Select correct option:
Credit
Letter of credit
Confirmation
Honor
Question # 15 of 15 ( Start time: 11:06:03 PM ) Total Marks: 1
In which of the following years, “Wafaqi Mohtasib” was established?
Select correct option:
1983
1995
2000
2005
Another Quiz:-
Question # 1 of 15 ( Start time: 11:08:04 PM ) Total Marks: 1
According to Section 16 of Banking Companies Ordinance, 1962, which of the following is the MAXIMUM commission, brokerage, discount or remuneration paid by banking company on issue of share capital?
Select correct option:
2% of the paid up value of the issued shares
2.5% of the paid up value of the issued shares
3% of the paid up value of the issued shares
3.5% of the paid up value of the issued shares
Question # 2 of 15 ( Start time: 11:09:36 PM ) Total Marks: 1
Of the following who make the contract void?
Select correct option:
Minor
Insolvent
Lunatic
All of the given options
Question # 3 of 15 ( Start time: 11:10:52 PM ) Total Marks: 1
Which of the following refers to “the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability”?
Select correct option:
Pledge
Hypothecation
Mortgage
Lien
Question # 4 of 15 ( Start time: 11:11:30 PM ) Total Marks: 1
All of the following are requirements of the Memorandum, under Banking Companies Ordinance, 1962, EXCEPT:
Select correct option:
Required to be printed
Issue of shares and allotment of shares
Should be divided into paragraphs
Paragraphs to be consecutively numbered
Question # 5 of 15 ( Start time: 11:12:21 PM ) Total Marks: 1
Which of the following condition(s) may lead to cancellation of license of a banking company?
Select correct option:
If the company ceases to carry on banking business in Pakistan
If the company at any time fails to comply with any of the conditions imposed upon it under sub-section (1)
If at any time, any of the conditions referred to in sub-section (3) ceases to be fulfilled
All of the given options
Question # 6 of 15 ( Start time: 11:12:39 PM ) Total Marks: 1
According to Section 4 of State Bank of Pakistan Act, 1956, which of the following should be the original Capital of the Bank?
Select correct option:
Rs. 20 Millions
Rs. 30 Millions
Rs. 40 Millions
Rs. 50 Millions
Question # 8 of 15 ( Start time: 11:13:05 PM ) Total Marks: 1
Which of the following refers to “the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them”?
Select correct option:
Bailment
Mortgage
Lien
Pledge
Question # 9 of 15 ( Start time: 11:13:16 PM ) Total Marks: 1
A banking company can engage itself in which of the following businesses under section 7 of Banking Companies Ordinance, 1962?
Select correct option:
Borrowing, raising, or taking up of money
The lending or advancing of money either upon or without security
The granting and issuing of letters of credit
All of the given options
Question # 10 of 15 ( Start time: 11:13:41 PM ) Total Marks: 1
Under Section 10 (Penalty) of the Co-operative Societies and Co-operative Banks (Repayment of Loans) Ordinance, 1966, if a person whoever contravenes any of the provisions of this Ordinance or the rules made shall be punishable with imprisonment of which of the following?
Select correct option:
Term which may extend to five years
Term which may extend to six years
Term which may extend to seven years
Term which may extend to eight years
Question # 12 of 15 ( Start time: 11:16:04 PM ) Total Marks: 1
According to Section 36 of Banking Companies Ordinance, 1962, the banking company should submit its financial statements and the audit report to the State bank within which of the following periods?
Select correct option:
2 Months
3 Months
4 Months
6 Months
11) Bank word derived from………………………A)BANCUS ….. FORGET OTHERS.
Question # 13 of 15 ( Start time: 11:17:30 PM ) Total Marks: 1
According to URR525, which of the following is a bank that has issued a Credit and the Reimbursement Authorization under that Credit?
Select correct option:
Issuing bank
Paying bank
Advising bank
Confirming bank
Question # 14 of 15 ( Start time: 11:17:54 PM ) Total Marks: 1
Who among the following is appointed by a court to look after the estate of a person who died without leaving a WILL?
Select correct option:
Agent
Lawyer
Lawyer
Administrator
Question # 15 of 15 ( Start time: 11:18:32 PM ) Total Marks: 1
------Studies history of law and evolution of law over a period of time and also amendments, introduction of new principles of law.
Select correct option:
Analytical Jurisprudence.
Social Jurisprudence.
Historical Jurisprudence.
Ethical Jurisprudence.
According to Section 16 of Banking Companies Ordinance, 1962, which of the following is the MAXIMUM commission, brokerage, discount or remuneration paid by banking company on issue of share capital?
Select correct option:
2% of the paid up value of the issued shares
2.5% of the paid up value of the issued shares
3% of the paid up value of the issued shares
3.5% of the paid up value of the issued shares
Question # 2 of 15 ( Start time: 11:09:36 PM ) Total Marks: 1
Of the following who make the contract void?
Select correct option:
Minor
Insolvent
Lunatic
All of the given options
Question # 3 of 15 ( Start time: 11:10:52 PM ) Total Marks: 1
Which of the following refers to “the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability”?
Select correct option:
Pledge
Hypothecation
Mortgage
Lien
Question # 4 of 15 ( Start time: 11:11:30 PM ) Total Marks: 1
All of the following are requirements of the Memorandum, under Banking Companies Ordinance, 1962, EXCEPT:
Select correct option:
Required to be printed
Issue of shares and allotment of shares
Should be divided into paragraphs
Paragraphs to be consecutively numbered
Question # 5 of 15 ( Start time: 11:12:21 PM ) Total Marks: 1
Which of the following condition(s) may lead to cancellation of license of a banking company?
Select correct option:
If the company ceases to carry on banking business in Pakistan
If the company at any time fails to comply with any of the conditions imposed upon it under sub-section (1)
If at any time, any of the conditions referred to in sub-section (3) ceases to be fulfilled
All of the given options
Question # 6 of 15 ( Start time: 11:12:39 PM ) Total Marks: 1
According to Section 4 of State Bank of Pakistan Act, 1956, which of the following should be the original Capital of the Bank?
Select correct option:
Rs. 20 Millions
Rs. 30 Millions
Rs. 40 Millions
Rs. 50 Millions
Question # 8 of 15 ( Start time: 11:13:05 PM ) Total Marks: 1
Which of the following refers to “the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them”?
Select correct option:
Bailment
Mortgage
Lien
Pledge
Question # 9 of 15 ( Start time: 11:13:16 PM ) Total Marks: 1
A banking company can engage itself in which of the following businesses under section 7 of Banking Companies Ordinance, 1962?
Select correct option:
Borrowing, raising, or taking up of money
The lending or advancing of money either upon or without security
The granting and issuing of letters of credit
All of the given options
Question # 10 of 15 ( Start time: 11:13:41 PM ) Total Marks: 1
Under Section 10 (Penalty) of the Co-operative Societies and Co-operative Banks (Repayment of Loans) Ordinance, 1966, if a person whoever contravenes any of the provisions of this Ordinance or the rules made shall be punishable with imprisonment of which of the following?
Select correct option:
Term which may extend to five years
Term which may extend to six years
Term which may extend to seven years
Term which may extend to eight years
Question # 12 of 15 ( Start time: 11:16:04 PM ) Total Marks: 1
According to Section 36 of Banking Companies Ordinance, 1962, the banking company should submit its financial statements and the audit report to the State bank within which of the following periods?
Select correct option:
2 Months
3 Months
4 Months
6 Months
11) Bank word derived from………………………A)BANCUS ….. FORGET OTHERS.
Question # 13 of 15 ( Start time: 11:17:30 PM ) Total Marks: 1
According to URR525, which of the following is a bank that has issued a Credit and the Reimbursement Authorization under that Credit?
Select correct option:
Issuing bank
Paying bank
Advising bank
Confirming bank
Question # 14 of 15 ( Start time: 11:17:54 PM ) Total Marks: 1
Who among the following is appointed by a court to look after the estate of a person who died without leaving a WILL?
Select correct option:
Agent
Lawyer
Lawyer
Administrator
Question # 15 of 15 ( Start time: 11:18:32 PM ) Total Marks: 1
------Studies history of law and evolution of law over a period of time and also amendments, introduction of new principles of law.
Select correct option:
Analytical Jurisprudence.
Social Jurisprudence.
Historical Jurisprudence.
Ethical Jurisprudence.
Friday, July 9, 2010
MGT411 Assignment No. 2 Solution
QUESTION #1:Marks 20)
Mr.Toseef,the Chief Financial Officer of a mutual fund Company,was given the task to ascertain the firm ’s bond and stock values.To perform the necessary analysis,Mr.Toseef gathered the following relevant data on the firm ’s bonds and stocks.BONDS:The firm has a Rs.1,000 par value bond with a 9 percent coupon interest rate outstanding. The bond has 12 years remaining to its maturity date.STOCKS:The firm ’s common stock currently pays an annual dividend of Rs.1.80 per share.The required return on the common stock is 12 percent.
Mr.Toseef,the Chief Financial Officer of a mutual fund Company,was given the task to ascertain the firm ’s bond and stock values.To perform the necessary analysis,Mr.Toseef gathered the following relevant data on the firm ’s bonds and stocks.BONDS:The firm has a Rs.1,000 par value bond with a 9 percent coupon interest rate outstanding. The bond has 12 years remaining to its maturity date.STOCKS:The firm ’s common stock currently pays an annual dividend of Rs.1.80 per share.The required return on the common stock is 12 percent.
REQUIRED:
Bonds:
Bonds:
A.If interest is paid annually ,what is the value of the bond when the required stated return is 10 percent
B.Using the 10 percent required return,find the bond ’s value when interest is paid semiannually Stock:
B.Using the 10 percent required return,find the bond ’s value when interest is paid semiannually Stock:
Estimate the value of common stock under each of the following dividend-growth-rate assumptions:
A.Dividends are expected to grow at a constant annual rate of 5 percent to infinity.
B.Dividends are expected to grow at an annual rate of 5 percent for each of the next 3 years followed by a constant annual growth rate of 4 percent in years 4 to infinity.
B.Dividends are expected to grow at an annual rate of 5 percent for each of the next 3 years followed by a constant annual growth rate of 4 percent in years 4 to infinity.
Solution:-
Question#1 Solution:
Bond Valuation
Part a)
Bond value = c [1 – 1/(1+r)^n] / r + Par/(1+r)^n
Bond value = 90 [1 – 1/(1+0.10)^12] / 0.10 + 1000/(1+0.10)^12
Bond Value = 90 [1 – 0.3186 /0.10] + 1000/3.1384
Bond value = 90 (6.814) + 318.63
Bond value = 613.26 +318.63
Bond Value = 931
Part b)
Bond value = c [1 – 1/(1+r)^n ]/ r + Par/(1+r)^n
Bond value = 45 [1 – 1/(1+0.05)^24 / 0.05 + 1000/(1+0.05)^24
Bond Value = 45 [1 – 0.3100 /0.05] + 1000/3.2250
Bond value = 45 (13.8) + 310.07
Bond value = 621 +310.
Bond Value = 931
Part a)
P = Div(1+g)/rF +rP – g
D = 1.80
Rce = rF +rP = 12%
g = 5%
P = 1.80 (1+0.05) / 12% - 5%
P = 1.80 (1.05) / 7%
P = 1.89/0.07
P = 27
Part b)
Div1= Do(1+g)3
Div1= 1.80 (1+0.05)3
Div1= 1.80 (1.1576)
Div1 = 2.083
P0 = D0 x (1 + g)/(R – g)
P0= 2.083 x 1.04/(0.12 – 0.04)
P0= 2.166 / 0.08
P0= 27.075
QUESTION #2 Marks 10)
A commercial bank has following data:
Total assets valued Rs.1,000,000
Item Assets Liabilities
Interest rate sensitive 30%40%
Interest rate non-sensitive 70%60%
Initial interest rate 10%7%
Interest rate increase 2%both in assets and liabilityRequired
What will be the net interest profit increase /decrease due to the interest rate change your answer should be in absolute amount.
A commercial bank has following data:
Total assets valued Rs.1,000,000
Item Assets Liabilities
Interest rate sensitive 30%40%
Interest rate non-sensitive 70%60%
Initial interest rate 10%7%
Interest rate increase 2%both in assets and liabilityRequired
What will be the net interest profit increase /decrease due to the interest rate change your answer should be in absolute amount.
Solution:-
Assets
Liabilities
Interest rate sensitive
300000
400000
Not interest rate sensitive
700000
600000
Initial interest rate
10%
7%
New increased interest rate on interest rate sensitive assets & liabilities
12%
9%
Revenue from Assets
Revenue from Liabilities
At initial interest rate
(0.10×300000)+(0.10×700000)
=100000
(0.07×400000)+(0.07×600000)
=70000
After an increase in interest rate
(0.12×300000)+(0.10×700000)
=106000
(0.09×400000)+(0.07×600000)
=78000
Profits at an initial interest rate:
Profit = (100000) – (70000) = 30000
Profits after an increase in interest rate:
Profit = (106000) – (78000)=28000
Gap Analysis Gap between interest rate sensitive assets and interest rate sensitive liabilities = (Interest rate sensitive assets of 300000) – (Interest rate sensitive liabilities Of 400000) =(Gap of - 100000)
Liabilities
Interest rate sensitive
300000
400000
Not interest rate sensitive
700000
600000
Initial interest rate
10%
7%
New increased interest rate on interest rate sensitive assets & liabilities
12%
9%
Revenue from Assets
Revenue from Liabilities
At initial interest rate
(0.10×300000)+(0.10×700000)
=100000
(0.07×400000)+(0.07×600000)
=70000
After an increase in interest rate
(0.12×300000)+(0.10×700000)
=106000
(0.09×400000)+(0.07×600000)
=78000
Profits at an initial interest rate:
Profit = (100000) – (70000) = 30000
Profits after an increase in interest rate:
Profit = (106000) – (78000)=28000
Gap Analysis Gap between interest rate sensitive assets and interest rate sensitive liabilities = (Interest rate sensitive assets of 300000) – (Interest rate sensitive liabilities Of 400000) =(Gap of - 100000)
Please do make changes in these assignment otherwise every one who copy this assignment as it is will awarded zero marks
MGT411 Assignment No. 2 Solution
QUESTION #1:Marks 20)
Mr.Toseef,the Chief Financial Officer of a mutual fund Company,was given the task to ascertain the firm ’s bond and stock values.To perform the necessary analysis,Mr.Toseef gathered the following relevant data on the firm ’s bonds and stocks.BONDS:The firm has a Rs.1,000 par value bond with a 9 percent coupon interest rate outstanding. The bond has 12 years remaining to its maturity date.STOCKS:The firm ’s common stock currently pays an annual dividend of Rs.1.80 per share.The required return on the common stock is 12 percent.
Mr.Toseef,the Chief Financial Officer of a mutual fund Company,was given the task to ascertain the firm ’s bond and stock values.To perform the necessary analysis,Mr.Toseef gathered the following relevant data on the firm ’s bonds and stocks.BONDS:The firm has a Rs.1,000 par value bond with a 9 percent coupon interest rate outstanding. The bond has 12 years remaining to its maturity date.STOCKS:The firm ’s common stock currently pays an annual dividend of Rs.1.80 per share.The required return on the common stock is 12 percent.
REQUIRED:
Bonds:
Bonds:
A.If interest is paid annually ,what is the value of the bond when the required stated return is 10 percent
B.Using the 10 percent required return,find the bond ’s value when interest is paid semiannually Stock:
B.Using the 10 percent required return,find the bond ’s value when interest is paid semiannually Stock:
Estimate the value of common stock under each of the following dividend-growth-rate assumptions:
A.Dividends are expected to grow at a constant annual rate of 5 percent to infinity.
B.Dividends are expected to grow at an annual rate of 5 percent for each of the next 3 years followed by a constant annual growth rate of 4 percent in years 4 to infinity.
B.Dividends are expected to grow at an annual rate of 5 percent for each of the next 3 years followed by a constant annual growth rate of 4 percent in years 4 to infinity.
Solution:-
Question#1 Solution:
Bond Valuation
Part a)
Bond value = c [1 – 1/(1+r)^n] / r + Par/(1+r)^n
Bond value = 90 [1 – 1/(1+0.10)^12] / 0.10 + 1000/(1+0.10)^12
Bond Value = 90 [1 – 0.3186 /0.10] + 1000/3.1384
Bond value = 90 (6.814) + 318.63
Bond value = 613.26 +318.63
Bond Value = 931
Part b)
Bond value = c [1 – 1/(1+r)^n ]/ r + Par/(1+r)^n
Bond value = 45 [1 – 1/(1+0.05)^24 / 0.05 + 1000/(1+0.05)^24
Bond Value = 45 [1 – 0.3100 /0.05] + 1000/3.2250
Bond value = 45 (13.8) + 310.07
Bond value = 621 +310.
Bond Value = 931
Part a)
P = Div(1+g)/rF +rP – g
D = 1.80
Rce = rF +rP = 12%
g = 5%
P = 1.80 (1+0.05) / 12% - 5%
P = 1.80 (1.05) / 7%
P = 1.89/0.07
P = 27
Part b)
Div1= Do(1+g)3
Div1= 1.80 (1+0.05)3
Div1= 1.80 (1.1576)
Div1 = 2.083
P0 = D0 x (1 + g)/(R – g)
P0= 2.083 x 1.04/(0.12 – 0.04)
P0= 2.166 / 0.08
P0= 27.075
QUESTION #2 Marks 10)
A commercial bank has following data:
Total assets valued Rs.1,000,000
Item Assets Liabilities
Interest rate sensitive 30%40%
Interest rate non-sensitive 70%60%
Initial interest rate 10%7%
Interest rate increase 2%both in assets and liabilityRequired
What will be the net interest profit increase /decrease due to the interest rate change your answer should be in absolute amount.
A commercial bank has following data:
Total assets valued Rs.1,000,000
Item Assets Liabilities
Interest rate sensitive 30%40%
Interest rate non-sensitive 70%60%
Initial interest rate 10%7%
Interest rate increase 2%both in assets and liabilityRequired
What will be the net interest profit increase /decrease due to the interest rate change your answer should be in absolute amount.
Solution:-
Assets
Liabilities
Interest rate sensitive
300000
400000
Not interest rate sensitive
700000
600000
Initial interest rate
10%
7%
New increased interest rate on interest rate sensitive assets & liabilities
12%
9%
Revenue from Assets
Revenue from Liabilities
At initial interest rate
(0.10×300000)+(0.10×700000)
=100000
(0.07×400000)+(0.07×600000)
=70000
After an increase in interest rate
(0.12×300000)+(0.10×700000)
=106000
(0.09×400000)+(0.07×600000)
=78000
Profits at an initial interest rate:
Profit = (100000) – (70000) = 30000
Profits after an increase in interest rate:
Profit = (106000) – (78000)=28000
Gap Analysis Gap between interest rate sensitive assets and interest rate sensitive liabilities = (Interest rate sensitive assets of 300000) – (Interest rate sensitive liabilities Of 400000) =(Gap of - 100000)
Liabilities
Interest rate sensitive
300000
400000
Not interest rate sensitive
700000
600000
Initial interest rate
10%
7%
New increased interest rate on interest rate sensitive assets & liabilities
12%
9%
Revenue from Assets
Revenue from Liabilities
At initial interest rate
(0.10×300000)+(0.10×700000)
=100000
(0.07×400000)+(0.07×600000)
=70000
After an increase in interest rate
(0.12×300000)+(0.10×700000)
=106000
(0.09×400000)+(0.07×600000)
=78000
Profits at an initial interest rate:
Profit = (100000) – (70000) = 30000
Profits after an increase in interest rate:
Profit = (106000) – (78000)=28000
Gap Analysis Gap between interest rate sensitive assets and interest rate sensitive liabilities = (Interest rate sensitive assets of 300000) – (Interest rate sensitive liabilities Of 400000) =(Gap of - 100000)
Please do make changes in these assignment otherwise every one who copy this assignment as it is will awarded zero marks
Saturday, July 3, 2010
BNK601 Assignment # 2 Solution
BNK601 Assignment # 2 Solution:
Q 1: Whether you open his account if yes then what are the procedures of opening?
Solution:
A person who has not attained the age of 18 years is a minor. A minor cannot enter into a contract. Therefore any contract with minor is void. However a bank can accept and open a minor's account if it is directed by the guardian court. So, as a banker I open his account. In this case a guardian signs the account opening form and gives his own specimen signature for account operation as mentioned under section 3 of majority Act 1875, the court appoints a guardian of a minor who obtains and signs the prescribed opening form of the account himself. He gives his own specimen signatures for the operation of the account.
Each withdrawal from the minor's account by the guardian is subject to the approval and sanction of the guardian court. On attaining the age of majority which is 21 years, the minor is allowed to open and operate the account himself. The authority of legal guardian ceases to exist.
So the minor can open an account through some guardian.
Q 1: Whether you open his account if yes then what are the procedures of opening?
Solution:
A person who has not attained the age of 18 years is a minor. A minor cannot enter into a contract. Therefore any contract with minor is void. However a bank can accept and open a minor's account if it is directed by the guardian court. So, as a banker I open his account. In this case a guardian signs the account opening form and gives his own specimen signature for account operation as mentioned under section 3 of majority Act 1875, the court appoints a guardian of a minor who obtains and signs the prescribed opening form of the account himself. He gives his own specimen signatures for the operation of the account.
Each withdrawal from the minor's account by the guardian is subject to the approval and sanction of the guardian court. On attaining the age of majority which is 21 years, the minor is allowed to open and operate the account himself. The authority of legal guardian ceases to exist.
So the minor can open an account through some guardian.
BNK601 Assignment # 2 Solution
BNK601 Assignment # 2 Solution:
Q 1: Whether you open his account if yes then what are the procedures of opening?
Solution:
A person who has not attained the age of 18 years is a minor. A minor cannot enter into a contract. Therefore any contract with minor is void. However a bank can accept and open a minor's account if it is directed by the guardian court. So, as a banker I open his account. In this case a guardian signs the account opening form and gives his own specimen signature for account operation as mentioned under section 3 of majority Act 1875, the court appoints a guardian of a minor who obtains and signs the prescribed opening form of the account himself. He gives his own specimen signatures for the operation of the account.
Each withdrawal from the minor's account by the guardian is subject to the approval and sanction of the guardian court. On attaining the age of majority which is 21 years, the minor is allowed to open and operate the account himself. The authority of legal guardian ceases to exist.
So the minor can open an account through some guardian.
Friday, June 18, 2010
mgt411 Online Quiz (18-21 June 2010
Question # 1 of 15 ( Start time: 03:58:32 AM ) Total Marks: 1
The return on holding a bond till its maturity is called:
Select correct option:
Coupon rate
Yield to maturity
Current yield
Internal rate of return
Question # 2 of 15 ( Start time: 03:58:53 AM ) Total Marks: 1
What is the true relationship that exists between default risk and yield?
Select correct option:
Higher the default risk, higher the yield
Lower the default risk, higher the yield
Higher the default risk yield will remain constant
Lower the default risk yield will remain constant
Question # 3 of 15 ( Start time: 03:59:11 AM ) Total Marks: 1
The theory of efficient market states that prices of financial instruments reflect:
Select correct option:
All available information
Some of the information
No information
Imperfect information
Question # 4 of 15 ( Start time: 03:59:37 AM ) Total Marks: 1
Which one of the following is the procedure of finding out the Present Value (PV)?
Select correct option:
Discounting
Compounding
Time value of money
Bond pricing
Question # 5 of 15 ( Start time: 04:00:55 AM ) Total Marks: 1
Diversification is the principle of:
Select correct option:
Holding more than one risk at a time
Reducing the risks we carry to just two
Creating risk to increase returns
Eliminating investments from our portfolio that have idiosyncratic risk
Question # 6 of 15 ( Start time: 04:01:16 AM ) Total Marks: 1
The price of a coupon bond can best be described as:
Select correct option:
The present value of the face value
The future value of the coupon payments and the face value
The present value of the coupon payments
Both The present value of the face value and of the coupon payments
Question # 7 of 15 ( Start time: 04:01:36 AM ) Total Marks: 1
An index number is a valuable tool because:
Select correct option:
The number by itself provides all of the useful information needed
The index provides a meaningful measurement scale to calculate percentage changes
The index is more stable than the data it reflects
It does not require any calculations to compute percentage changes
Question # 8 of 15 ( Start time: 04:02:02 AM ) Total Marks: 1
A risk-averse investor will:
Select correct option:
Always prefer an investment with a lower expected return
Always prefer an investment with a certain return to one with the same expected return but any amount of uncertainty
Always require a certain return
Always focus exclusively on the expected return
Question # 9 of 15 ( Start time: 04:02:21 AM ) Total Marks: 1
Which of the following is NOT included in the definition of M1?
Select correct option:
Traveler’s checks
Demand deposits
Currency
Gold coins issued by treasury
Question # 10 of 15 ( Start time: 04:02:33 AM ) Total Marks: 1
Which of the following statement is true about the relation ship between bond ,coupon payment and interest?
Select correct option:
Coupon payments fall, the interest rate falls, and Bond price will rise
Coupon payments rises, the interest rate falls, and Bond price will rise
Coupon payments fall, the interest rate falls, and Bond price will fall
Coupon payments rise, the interest rate falls, and Bond price will fall
Question # 11 of 15 ( Start time: 04:03:32 AM ) Total Marks: 1
There is no guarantee that a bond issuer will make the promised payments is known as which one of the following?
Select correct option:
Default risk
Inflation risk
Interest rate risk
Systematic risk
Question # 12 of 15 ( Start time: 04:03:52 AM ) Total Marks: 1
Banks can also borrow by using a repurchase agreement or repo, which is a short-term _____________.
Select correct option:
Discount loan
Collateralized loan
Personal loan
Corporate loan
Question # 14 of 15 ( Start time: 04:05:05 AM ) Total Marks: 1
Which of the following would be included in a definition of risk?
Select correct option:
Risk is a not measure of uncertainty
Risk is unavoidable
Risk doesn't have a time horizon
Risk seldom involves some future payoff
Question # 15 of 15 ( Start time: 04:06:29 AM ) Total Marks: 1
When the auto manufacturing industry does poorly due to a recession this is an example of:
Select correct option:
Idiosyncratic risk
Systematic risk
Risk premium
Unique risk
The return on holding a bond till its maturity is called:
Select correct option:
Coupon rate
Yield to maturity
Current yield
Internal rate of return
Question # 2 of 15 ( Start time: 03:58:53 AM ) Total Marks: 1
What is the true relationship that exists between default risk and yield?
Select correct option:
Higher the default risk, higher the yield
Lower the default risk, higher the yield
Higher the default risk yield will remain constant
Lower the default risk yield will remain constant
Question # 3 of 15 ( Start time: 03:59:11 AM ) Total Marks: 1
The theory of efficient market states that prices of financial instruments reflect:
Select correct option:
All available information
Some of the information
No information
Imperfect information
Question # 4 of 15 ( Start time: 03:59:37 AM ) Total Marks: 1
Which one of the following is the procedure of finding out the Present Value (PV)?
Select correct option:
Discounting
Compounding
Time value of money
Bond pricing
Question # 5 of 15 ( Start time: 04:00:55 AM ) Total Marks: 1
Diversification is the principle of:
Select correct option:
Holding more than one risk at a time
Reducing the risks we carry to just two
Creating risk to increase returns
Eliminating investments from our portfolio that have idiosyncratic risk
Question # 6 of 15 ( Start time: 04:01:16 AM ) Total Marks: 1
The price of a coupon bond can best be described as:
Select correct option:
The present value of the face value
The future value of the coupon payments and the face value
The present value of the coupon payments
Both The present value of the face value and of the coupon payments
Question # 7 of 15 ( Start time: 04:01:36 AM ) Total Marks: 1
An index number is a valuable tool because:
Select correct option:
The number by itself provides all of the useful information needed
The index provides a meaningful measurement scale to calculate percentage changes
The index is more stable than the data it reflects
It does not require any calculations to compute percentage changes
Question # 8 of 15 ( Start time: 04:02:02 AM ) Total Marks: 1
A risk-averse investor will:
Select correct option:
Always prefer an investment with a lower expected return
Always prefer an investment with a certain return to one with the same expected return but any amount of uncertainty
Always require a certain return
Always focus exclusively on the expected return
Question # 9 of 15 ( Start time: 04:02:21 AM ) Total Marks: 1
Which of the following is NOT included in the definition of M1?
Select correct option:
Traveler’s checks
Demand deposits
Currency
Gold coins issued by treasury
Question # 10 of 15 ( Start time: 04:02:33 AM ) Total Marks: 1
Which of the following statement is true about the relation ship between bond ,coupon payment and interest?
Select correct option:
Coupon payments fall, the interest rate falls, and Bond price will rise
Coupon payments rises, the interest rate falls, and Bond price will rise
Coupon payments fall, the interest rate falls, and Bond price will fall
Coupon payments rise, the interest rate falls, and Bond price will fall
Question # 11 of 15 ( Start time: 04:03:32 AM ) Total Marks: 1
There is no guarantee that a bond issuer will make the promised payments is known as which one of the following?
Select correct option:
Default risk
Inflation risk
Interest rate risk
Systematic risk
Question # 12 of 15 ( Start time: 04:03:52 AM ) Total Marks: 1
Banks can also borrow by using a repurchase agreement or repo, which is a short-term _____________.
Select correct option:
Discount loan
Collateralized loan
Personal loan
Corporate loan
Question # 14 of 15 ( Start time: 04:05:05 AM ) Total Marks: 1
Which of the following would be included in a definition of risk?
Select correct option:
Risk is a not measure of uncertainty
Risk is unavoidable
Risk doesn't have a time horizon
Risk seldom involves some future payoff
Question # 15 of 15 ( Start time: 04:06:29 AM ) Total Marks: 1
When the auto manufacturing industry does poorly due to a recession this is an example of:
Select correct option:
Idiosyncratic risk
Systematic risk
Risk premium
Unique risk
Another Quiz:-
Question # 1 of 15 ( Start time: 04:22:12 AM ) Total Marks: 1
The bond rating of a security refers to which of the followings?
Select correct option:
The size of the coupon payment relative to the face value
The return a holder is likely to receive
The likelihood the lender/borrower will be repaid by the borrower/issuer
The years until the bond matures
Question # 2 of 15 ( Start time: 04:22:32 AM ) Total Marks: 1
Which of the following are used to monitor and stabilize the economy?
Select correct option:
Stock exchanges
Commercial Banks
Central Banks
Financial institutions
Question # 3 of 15 ( Start time: 04:22:51 AM ) Total Marks: 1
The relationship between the price and the interest rate for a zero coupon bond is best described as:
Select correct option:
Volatile
Stable
Non-existent
Inverse
Question # 4 of 15 ( Start time: 04:23:14 AM ) Total Marks: 1
Which of the following NOT true for financial institutions?
Select correct option:
It reduces the transaction cost
It reduce the information cost
It reduces the asymmetric information
It doesn’t make long term loans
Question # 5 of 15 ( Start time: 04:24:40 AM ) Total Marks: 1
Most of the people among us are ___________.
Select correct option:
Risk lovers
Risk enhancers
Risk averse
Risk tolerating
Question # 6 of 15 ( Start time: 04:25:45 AM ) Total Marks: 1
The price of a coupon bond can best be described as:
Select correct option:
The present value of the face value
The future value of the coupon payments and the face value
The present value of the coupon payments
Both The present value of the face value and of the coupon payments
Question # 7 of 15 ( Start time: 04:26:10 AM ) Total Marks: 1
A risk-averse investor will:
Select correct option:
Always prefer an investment with a lower expected return
Always prefer an investment with a certain return to one with the same expected return but any amount of uncertainty
Always require a certain return
Always focus exclusively on the expected return
Question # 8 of 15 ( Start time: 04:26:18 AM ) Total Marks: 1
What is true relationship between return and risk?
Select correct option:
Lower the risk greater the return
Greater the risk greater the return
Greater the risk the return will remain constant
No relationship between them
Question # 9 of 15 ( Start time: 04:26:42 AM ) Total Marks: 1
Financial development measured by
Select correct option:
M1/GDP
M2/GDP
M3/DGP
All of above
Question # 10 of 15 ( Start time: 04:28:09 AM ) Total Marks: 1
A loan that is used to purchase the real estate is known as:
Select correct option:
Real estate loan
Home mortgages
Fixed payment loan
Home loan
Question # 11 of 15 ( Start time: 04:28:27 AM ) Total Marks: 1
Which of the following is NOT a depository financial institution?
Select correct option:
Credit Union
Savings and Loan
Commercial bank
Life Insurance Company
Question # 12 of 15 ( Start time: 04:28:44 AM ) Total Marks: 1
If the tax rate is higher than gap between yield on taxable and tax exempt bond?
Select correct option:
Shorter
Wider
No gap
Any thing can be possible
Question # 13 of 15 ( Start time: 04:29:01 AM ) Total Marks: 1
----- example of channel fund from saver to borrower.
Select correct option:
Bank
Mutual fund
Finance companies
All of above
Question # 14 of 15 ( Start time: 04:30:10 AM ) Total Marks: 1
You receive a check for $100 two years from today. The discounted present value of this $100 is:
Select correct option:
$100/(1+i)
$100*(1+i)2
$100*(1+i)
$100/(1+i)2
Question # 15 of 15 ( Start time: 04:30:31 AM ) Total Marks: 1
Which one of the following is NOT true for the expectation hypothesis?
Select correct option:
Risk free interest rate can be computed
There is uncertainty in the future
Identifying yield of bond today that will be available next year
It focuses on risk free interest rate and the risk premium
The bond rating of a security refers to which of the followings?
Select correct option:
The size of the coupon payment relative to the face value
The return a holder is likely to receive
The likelihood the lender/borrower will be repaid by the borrower/issuer
The years until the bond matures
Question # 2 of 15 ( Start time: 04:22:32 AM ) Total Marks: 1
Which of the following are used to monitor and stabilize the economy?
Select correct option:
Stock exchanges
Commercial Banks
Central Banks
Financial institutions
Question # 3 of 15 ( Start time: 04:22:51 AM ) Total Marks: 1
The relationship between the price and the interest rate for a zero coupon bond is best described as:
Select correct option:
Volatile
Stable
Non-existent
Inverse
Question # 4 of 15 ( Start time: 04:23:14 AM ) Total Marks: 1
Which of the following NOT true for financial institutions?
Select correct option:
It reduces the transaction cost
It reduce the information cost
It reduces the asymmetric information
It doesn’t make long term loans
Question # 5 of 15 ( Start time: 04:24:40 AM ) Total Marks: 1
Most of the people among us are ___________.
Select correct option:
Risk lovers
Risk enhancers
Risk averse
Risk tolerating
Question # 6 of 15 ( Start time: 04:25:45 AM ) Total Marks: 1
The price of a coupon bond can best be described as:
Select correct option:
The present value of the face value
The future value of the coupon payments and the face value
The present value of the coupon payments
Both The present value of the face value and of the coupon payments
Question # 7 of 15 ( Start time: 04:26:10 AM ) Total Marks: 1
A risk-averse investor will:
Select correct option:
Always prefer an investment with a lower expected return
Always prefer an investment with a certain return to one with the same expected return but any amount of uncertainty
Always require a certain return
Always focus exclusively on the expected return
Question # 8 of 15 ( Start time: 04:26:18 AM ) Total Marks: 1
What is true relationship between return and risk?
Select correct option:
Lower the risk greater the return
Greater the risk greater the return
Greater the risk the return will remain constant
No relationship between them
Question # 9 of 15 ( Start time: 04:26:42 AM ) Total Marks: 1
Financial development measured by
Select correct option:
M1/GDP
M2/GDP
M3/DGP
All of above
Question # 10 of 15 ( Start time: 04:28:09 AM ) Total Marks: 1
A loan that is used to purchase the real estate is known as:
Select correct option:
Real estate loan
Home mortgages
Fixed payment loan
Home loan
Question # 11 of 15 ( Start time: 04:28:27 AM ) Total Marks: 1
Which of the following is NOT a depository financial institution?
Select correct option:
Credit Union
Savings and Loan
Commercial bank
Life Insurance Company
Question # 12 of 15 ( Start time: 04:28:44 AM ) Total Marks: 1
If the tax rate is higher than gap between yield on taxable and tax exempt bond?
Select correct option:
Shorter
Wider
No gap
Any thing can be possible
Question # 13 of 15 ( Start time: 04:29:01 AM ) Total Marks: 1
----- example of channel fund from saver to borrower.
Select correct option:
Bank
Mutual fund
Finance companies
All of above
Question # 14 of 15 ( Start time: 04:30:10 AM ) Total Marks: 1
You receive a check for $100 two years from today. The discounted present value of this $100 is:
Select correct option:
$100/(1+i)
$100*(1+i)2
$100*(1+i)
$100/(1+i)2
Question # 15 of 15 ( Start time: 04:30:31 AM ) Total Marks: 1
Which one of the following is NOT true for the expectation hypothesis?
Select correct option:
Risk free interest rate can be computed
There is uncertainty in the future
Identifying yield of bond today that will be available next year
It focuses on risk free interest rate and the risk premium
Another Quiz:-
Question # 1 of 15 ( Start time: 04:39:43 AM ) Total Marks: 1
A
The risk premium of a bond will:
Select correct option:
Higher for investment-grade bonds than for high-yield bonds
Positive but small if the risk of default is zero
Decrease when the default risk rises
Increase when the risk of default rises
Question # 2 of 15 ( Start time: 04:40:01 AM ) Total Marks: 1
Banks can also borrow by using a repurchase agreement or repo, which is a short-term _____________.
Select correct option:
Discount loan
Collateralized loan
Personal loan
Corporate loan
Question # 3 of 15 ( Start time: 04:40:21 AM ) Total Marks: 1
There is no guarantee that a bond issuer will make the promised payments is known as which one of the following?
Select correct option:
Default risk
Inflation risk
Interest rate risk
Systematic risk
Question # 4 of 15 ( Start time: 04:40:39 AM ) Total Marks: 1
Mr A need 1000000 to buy a car for his personal use he contact with bank that give his loan this would be called
Select correct option:
Direct finance
Indirect finance
Facilitate payment
All of above
Question # 5 of 15 ( Start time: 04:41:01 AM ) Total Marks: 1
A graph of the term structure with YTM on Y-axis and time to maturity on X-axis is called:
Select correct option:
Demand curve
Supply curve
Yield curve
Leffer curve
Question # 6 of 15 ( Start time: 04:41:20 AM ) Total Marks: 1
Expectation hypothesis focuses on which one of the following?
Select correct option:
Risk premium
Risk free interest rate
Yield to maturity
None of the given options
Question # 7 of 15 ( Start time: 04:41:39 AM ) Total Marks: 1
What is true about the relationship between standard deviation and risk?
Select correct option:
Greater the standard deviation greater will be the risk
Greater the standard deviation lower will be the risk
Greater the standard deviation risk remains the same
No relation between them
Question # 8 of 15 ( Start time: 04:41:58 AM ) Total Marks: 1
Diversification is the principle of:
Select correct option:
Holding more than one risk at a time
Reducing the risks we carry to just two
Creating risk to increase returns
Eliminating investments from our portfolio that have idiosyncratic risk
Question # 9 of 15 ( Start time: 04:42:16 AM ) Total Marks: 1
The Financial Systems makes it easier to trade because it:
Select correct option:
Facilitate Payments
Channels Funds from Savers to Borrowers
Enables Risk Sharing
All of the given options
Question # 10 of 15 ( Start time: 04:42:31 AM ) Total Marks: 1
Which of the following statement is true about the relation ship between bond ,coupon payment and interest?
Select correct option:
Coupon payments fall, the interest rate falls, and Bond price will rise
Coupon payments rises, the interest rate falls, and Bond price will rise
Coupon payments fall, the interest rate falls, and Bond price will fall
Coupon payments rise, the interest rate falls, and Bond price will fall
Question # 11 of 15 ( Start time: 04:42:48 AM ) Total Marks: 1
If information in a financial market is asymmetric, this means:
Select correct option:
Borrowers and lenders have perfect information
Borrowers would have more information than lenders
Borrowers and lenders have the same information
Lenders lack any information
Question # 12 of 15 ( Start time: 04:43:22 AM ) Total Marks: 1
Which of the following is NOT an example of financial institutions?
Select correct option:
Banks
Securities firms
Stock exchanges
Insurance companies
Question # 13 of 15 ( Start time: 04:44:29 AM ) Total Marks: 1
Time affects the value of which of the following?
Select correct option:
Financial Instruments
Financial Markets
Financial Institutions
Central Banks
Question # 14 of 15 ( Start time: 04:44:47 AM ) Total Marks: 1
When stock prices reflect fundamental values:
Select correct option:
All investors will experience capital gains
All companies will have an easier task of obtaining financing for investment projects
The allocation of resources will be more efficient
The overall level of the stock market should move higher continuously
Question # 15 of 15 ( Start time: 04:45:13 AM ) Total Marks: 1
A bank can usually offer a saver a higher return for the same risk because:
Select correct option:
The bank can usually purchase assets at a higher cost than any one saver
The bank can pool the resources of larger savers and purchase lower denominated assets
Economies of scale can be applied by the bank in its purchase of assets
None of the given options
Another Quiz:-
Question # 1 of 15 ( Start time: 04:51:28 AM ) Total Marks: 1
The risk premium for an investment:
Select correct option:
Increases with risk
Is a fixed amount added to the risk free return
Is negative for U.S. Treasury Securities
Is negative for risk averse investors
Question # 2 of 15 ( Start time: 04:51:46 AM ) Total Marks: 1
If information in a financial market is asymmetric, this means:
Select correct option:
Borrowers and lenders have perfect information
Borrowers would have more information than lenders
Borrowers and lenders have the same information
Lenders lack any information
Question # 3 of 15 ( Start time: 04:51:54 AM ) Total Marks: 1
A typical bank will offer ________ type/s of checking accounts.
Select correct option:
Only one type
Two types
Four types
Six or more types
Question # 4 of 15 ( Start time: 04:52:35 AM ) Total Marks: 1
If the annual interest rate is 6%, the price of a 1-year Treasury bill with $100 face value would be:
Select correct option:
$94.00
$94.33
$95.25
$96.10
Question # 5 of 15 ( Start time: 04:52:50 AM ) Total Marks: 1
Government bonds called …….. Where as corporate bonds are called ……
Select correct option:
Zero coupon bond, coupon bond
Risky bond. Risk free bond
T bill, corporate bond
Console bond, junk bonds
Question # 6 of 15 ( Start time: 04:53:15 AM ) Total Marks: 1
Which of the following is NOT a depository financial institution?
Select correct option:
Credit Union
Savings and Loan
Commercial bank
Life Insurance Company
Question # 7 of 15 ( Start time: 04:53:31 AM ) Total Marks: 1
Bonds without maturity dates are which of the followings?
Select correct option:
Zero coupon bonds
Coupon securities
Consols
Preferred Bonds
Question # 8 of 15 ( Start time: 04:53:48 AM ) Total Marks: 1
Which of the following best expresses the proceeds a lender receives from a simple loan?
Select correct option:
PV(1 + i)
FV/i
PV + i
PV/i
Question # 9 of 15 ( Start time: 04:54:03 AM ) Total Marks: 1
Debt instruments is categorized on the basis of which one of the following?
Select correct option:
Loan maturity period
Interest rates
Mode of payment of interest
Amount of the debt taken
Question # 10 of 15 ( Start time: 04:54:20 AM ) Total Marks: 1
In the long run, the yield curve tends to be which of the following?
Select correct option:
Upward sloping
Downward sloping
Nearly vertical
Nearly horizontal
Question # 11 of 15 ( Start time: 04:54:35 AM ) Total Marks: 1
Financial instruments are evolved just as ____________.
Select correct option:
Currency
Stock
Bond
Commodity
Question # 12 of 15 ( Start time: 04:54:51 AM ) Total Marks: 1
If YTM is less than the coupon rate the price of the bond is __________.
Select correct option:
Greater than its face value
Lower than its face value
Equals to its face value
All of the given options
Question # 13 of 15 ( Start time: 04:55:54 AM ) Total Marks: 1
_____________ are organized to eliminate the need of costly information gathering.
Select correct option:
Central bank
Commercial banks
Stock exchanges
Insurance companies
Question # 14 of 15 ( Start time: 04:56:21 AM ) Total Marks: 1
Which of the following best describes the relationship between Bond prices and yields?
Select correct option:
Move together inversely
Bond yields do not change since the coupon is fixed
Move together directly
Are independent of each other
Question # 15 of 15 ( Start time: 04:56:37 AM ) Total Marks: 1
At which money aggregate definitions relation is stronger with inflation and growth
Select correct option:
M1
M2
M3
None of above
The risk premium for an investment:
Select correct option:
Increases with risk
Is a fixed amount added to the risk free return
Is negative for U.S. Treasury Securities
Is negative for risk averse investors
Question # 2 of 15 ( Start time: 04:51:46 AM ) Total Marks: 1
If information in a financial market is asymmetric, this means:
Select correct option:
Borrowers and lenders have perfect information
Borrowers would have more information than lenders
Borrowers and lenders have the same information
Lenders lack any information
Question # 3 of 15 ( Start time: 04:51:54 AM ) Total Marks: 1
A typical bank will offer ________ type/s of checking accounts.
Select correct option:
Only one type
Two types
Four types
Six or more types
Question # 4 of 15 ( Start time: 04:52:35 AM ) Total Marks: 1
If the annual interest rate is 6%, the price of a 1-year Treasury bill with $100 face value would be:
Select correct option:
$94.00
$94.33
$95.25
$96.10
Question # 5 of 15 ( Start time: 04:52:50 AM ) Total Marks: 1
Government bonds called …….. Where as corporate bonds are called ……
Select correct option:
Zero coupon bond, coupon bond
Risky bond. Risk free bond
T bill, corporate bond
Console bond, junk bonds
Question # 6 of 15 ( Start time: 04:53:15 AM ) Total Marks: 1
Which of the following is NOT a depository financial institution?
Select correct option:
Credit Union
Savings and Loan
Commercial bank
Life Insurance Company
Question # 7 of 15 ( Start time: 04:53:31 AM ) Total Marks: 1
Bonds without maturity dates are which of the followings?
Select correct option:
Zero coupon bonds
Coupon securities
Consols
Preferred Bonds
Question # 8 of 15 ( Start time: 04:53:48 AM ) Total Marks: 1
Which of the following best expresses the proceeds a lender receives from a simple loan?
Select correct option:
PV(1 + i)
FV/i
PV + i
PV/i
Question # 9 of 15 ( Start time: 04:54:03 AM ) Total Marks: 1
Debt instruments is categorized on the basis of which one of the following?
Select correct option:
Loan maturity period
Interest rates
Mode of payment of interest
Amount of the debt taken
Question # 10 of 15 ( Start time: 04:54:20 AM ) Total Marks: 1
In the long run, the yield curve tends to be which of the following?
Select correct option:
Upward sloping
Downward sloping
Nearly vertical
Nearly horizontal
Question # 11 of 15 ( Start time: 04:54:35 AM ) Total Marks: 1
Financial instruments are evolved just as ____________.
Select correct option:
Currency
Stock
Bond
Commodity
Question # 12 of 15 ( Start time: 04:54:51 AM ) Total Marks: 1
If YTM is less than the coupon rate the price of the bond is __________.
Select correct option:
Greater than its face value
Lower than its face value
Equals to its face value
All of the given options
Question # 13 of 15 ( Start time: 04:55:54 AM ) Total Marks: 1
_____________ are organized to eliminate the need of costly information gathering.
Select correct option:
Central bank
Commercial banks
Stock exchanges
Insurance companies
Question # 14 of 15 ( Start time: 04:56:21 AM ) Total Marks: 1
Which of the following best describes the relationship between Bond prices and yields?
Select correct option:
Move together inversely
Bond yields do not change since the coupon is fixed
Move together directly
Are independent of each other
Question # 15 of 15 ( Start time: 04:56:37 AM ) Total Marks: 1
At which money aggregate definitions relation is stronger with inflation and growth
Select correct option:
M1
M2
M3
None of above
Another Quiz:-
Question # 1 of 15 ( Start time: 04:59:31 AM ) Total Marks: 1
The interest rate that is involved in _____________ calculation is referred to as discount rate
Select correct option:
Present value
Future value
Intrinsic value
Discount value
Question # 2 of 15 ( Start time: 04:59:47 AM ) Total Marks: 1
Previously financial markets are located in which of the following?
Select correct option:
Coffee houses or Taverns
Stock exchanges
Bazaar
Coffee houses and Stock exchanges
Question # 3 of 15 ( Start time: 05:00:04 AM ) Total Marks: 1
----- example of channel fund from saver to borrower.
Select correct option:
Bank
Mutual fund
Finance companies
All of above
Question # 4 of 15 ( Start time: 05:00:15 AM ) Total Marks: 1
What characteristic of money is not included in securities characteristics
Select correct option:
Mean of payment
Unit of account
Store of value
Transfer of risk
Question # 5 of 15 ( Start time: 05:00:38 AM ) Total Marks: 1
The fact that common stockholders are residual claimants means:
Select correct option:
The stockholders receive their dividends before any other residuals are paid
The stockholders receive the remains after everyone else is paid
The stockholders are paid any past due dividends before other claims are paid
The common stockholders are responsible for all corporate debts
Question # 6 of 15 ( Start time: 05:01:51 AM ) Total Marks: 1
If YTM equals the coupon rate the price of the bond is __________.
Select correct option:
Greater than its face value
Lower than its face value
Equals to its face value
Insufficient information
Question # 7 of 15 ( Start time: 05:02:07 AM ) Total Marks: 1
Stock market bubbles can lead to:
Select correct option:
An inefficient allocation of resources
Stock market crashes
Patterns of volatile returns from the stock market
All of the given options
Question # 8 of 15 ( Start time: 05:03:19 AM ) Total Marks: 1
Core principles of Money and Banking include each of the following except?
Select correct option:
People act rationally
Time has value
Information is the basis for decisions
Risk requires compensation
Question # 9 of 15 ( Start time: 05:03:34 AM ) Total Marks: 1
Yield curves show which of the followings?
Select correct option:
The relationship between bond interest rates (yields) and bond prices
The relationship between liquidity and bond interest rates (yields)
The relationship between risk and bond interest rates (yields)
The relationship between time to maturity and bond interest rates (yields)
Question # 10 of 15 ( Start time: 05:03:56 AM ) Total Marks: 1
If bond’s rating is lower, what will be its price?
Select correct option:
Higher
Lower
Equal to
No change
Question # 11 of 15 ( Start time: 05:04:57 AM ) Total Marks: 1
The default premium:
Select correct option:
Is positive for a U.S. Treasury bond
Must always be less than 0 (zero)
Is also known as the risk spread
Is assigned by a bond rating agency
Question # 12 of 15 ( Start time: 05:05:14 AM ) Total Marks: 1
Which one of the following is the procedure of finding out the Present Value (PV)?
Select correct option:
Discounting
Compounding
Time value of money
Bond pricing
Question # 13 of 15 ( Start time: 05:05:37 AM ) Total Marks: 1
___________ include savings and time deposits and account for nearly two-thirds of all commercial bank liabilities.
Select correct option:
Non transactions Deposits
Borrowings
Checkable Deposits
Discount loans
Question # 14 of 15 ( Start time: 05:06:35 AM ) Total Marks: 1
The____________ are an assessment of the creditworthiness of the corporate issuer.
Select correct option:
Bond yield
Bond ratings
Bond risk
Bond price
Question # 15 of 15 ( Start time: 05:06:56 AM ) Total Marks: 1
When the auto manufacturing industry does poorly due to a recession this is an example of:
Select correct option:
Idiosyncratic risk
Systematic risk
Risk premium
Unique risk
The interest rate that is involved in _____________ calculation is referred to as discount rate
Select correct option:
Present value
Future value
Intrinsic value
Discount value
Question # 2 of 15 ( Start time: 04:59:47 AM ) Total Marks: 1
Previously financial markets are located in which of the following?
Select correct option:
Coffee houses or Taverns
Stock exchanges
Bazaar
Coffee houses and Stock exchanges
Question # 3 of 15 ( Start time: 05:00:04 AM ) Total Marks: 1
----- example of channel fund from saver to borrower.
Select correct option:
Bank
Mutual fund
Finance companies
All of above
Question # 4 of 15 ( Start time: 05:00:15 AM ) Total Marks: 1
What characteristic of money is not included in securities characteristics
Select correct option:
Mean of payment
Unit of account
Store of value
Transfer of risk
Question # 5 of 15 ( Start time: 05:00:38 AM ) Total Marks: 1
The fact that common stockholders are residual claimants means:
Select correct option:
The stockholders receive their dividends before any other residuals are paid
The stockholders receive the remains after everyone else is paid
The stockholders are paid any past due dividends before other claims are paid
The common stockholders are responsible for all corporate debts
Question # 6 of 15 ( Start time: 05:01:51 AM ) Total Marks: 1
If YTM equals the coupon rate the price of the bond is __________.
Select correct option:
Greater than its face value
Lower than its face value
Equals to its face value
Insufficient information
Question # 7 of 15 ( Start time: 05:02:07 AM ) Total Marks: 1
Stock market bubbles can lead to:
Select correct option:
An inefficient allocation of resources
Stock market crashes
Patterns of volatile returns from the stock market
All of the given options
Question # 8 of 15 ( Start time: 05:03:19 AM ) Total Marks: 1
Core principles of Money and Banking include each of the following except?
Select correct option:
People act rationally
Time has value
Information is the basis for decisions
Risk requires compensation
Question # 9 of 15 ( Start time: 05:03:34 AM ) Total Marks: 1
Yield curves show which of the followings?
Select correct option:
The relationship between bond interest rates (yields) and bond prices
The relationship between liquidity and bond interest rates (yields)
The relationship between risk and bond interest rates (yields)
The relationship between time to maturity and bond interest rates (yields)
Question # 10 of 15 ( Start time: 05:03:56 AM ) Total Marks: 1
If bond’s rating is lower, what will be its price?
Select correct option:
Higher
Lower
Equal to
No change
Question # 11 of 15 ( Start time: 05:04:57 AM ) Total Marks: 1
The default premium:
Select correct option:
Is positive for a U.S. Treasury bond
Must always be less than 0 (zero)
Is also known as the risk spread
Is assigned by a bond rating agency
Question # 12 of 15 ( Start time: 05:05:14 AM ) Total Marks: 1
Which one of the following is the procedure of finding out the Present Value (PV)?
Select correct option:
Discounting
Compounding
Time value of money
Bond pricing
Question # 13 of 15 ( Start time: 05:05:37 AM ) Total Marks: 1
___________ include savings and time deposits and account for nearly two-thirds of all commercial bank liabilities.
Select correct option:
Non transactions Deposits
Borrowings
Checkable Deposits
Discount loans
Question # 14 of 15 ( Start time: 05:06:35 AM ) Total Marks: 1
The____________ are an assessment of the creditworthiness of the corporate issuer.
Select correct option:
Bond yield
Bond ratings
Bond risk
Bond price
Question # 15 of 15 ( Start time: 05:06:56 AM ) Total Marks: 1
When the auto manufacturing industry does poorly due to a recession this is an example of:
Select correct option:
Idiosyncratic risk
Systematic risk
Risk premium
Unique risk
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