GENERAL AWARENESS PRACTICE QUESTIONS FOR BANK EXAMS

1. What role do Micro, Small and Medium Enterprises (MSMEs) play in a country’s economic and industrial development ?
(A) They have the capacity to absorb skilled and unskilled labour available in the country.
(B) Such institutions help in distribution of income in a wide spectrum and do not allow it to get concentrated in few hands or in few areas.
(C) They help in eradication of poverty by providing self-emplovment opportunities.
(1) Only (A)
(2) Only (B)
(3) Only (C)
(4) Only (A) & (C)
(5) All (A), (B) & (C)
2. Which of the following statements about the Indian Economy is correct ?
(1) Indian economy is as developed as that of China
(2) About 70% Indians are involved in some type of self-employment and are the owners of some or the other micro or small enterprise
(3) In India single biggest employment is agriculture and allied activities
(4) About 48% Indian workforce is employed in foreign countries or in organisations assisted by foreign capital
(5) None of these
3. Which of the following is/are correct about the problems of Indian Agriculture ?
(A) Large agricultural subsidies are hampering productivity-enhancing investments.
(B) Irrigation infrastructure is in bad shape and needs immediate improvement.
(C) Frequent takeovers of fertile land by private companies and multinationals to launch big business complexes.
(1) Only (A)
(2) Only (A) & (B)
(3) Only (A) & (C)
(4) All (A), (B) & (C)
(5) None of these
4. As per news in various journals, many banks have failed to achieve agri-loan target fixed by the RBI for the year 2010-11. What was the target fixed for the year ?
(1) 10%
(2) 15%
(3) 18%
(4) 24%
(5) 30%
5. Which of the following statements about Agro and Allied activities is not correct ?
(1) Farmers do not get adequate credit for purchase of cattle
(2) There is a need to improve breed and genetic characteristics of the cattle folk
(3) India has huge forest cover and also degraded and marshy land which can be used for productive purposes
(4) India is the 10th largest producer of medicinal and aromatic plants, but the products are not of commercial-value
(5) Animal husbandry plays an important role in providing sustainability under Rain-fed conditions
6. Which of the following schemes launched by the Government of India aims at enhancing the livelihood security of the people in rural areas by guaranteeing hundred days of employment in a financial year to a rural household whose adult members volunteer to do unskilled manual work ?
(1) TRYSEM
(2) Pradhan Mantri Gram Sadak Yojana
(3) Kutir Jyoti Scheme
(4) ASHA
(5) MGNREGA
7. In some parts of India, farmers face acute distress because of heavy burden of debt from non-institutional lenders. Who can be called a non-institutional lender ?
(1) Small Banks
(2) Grameen Banks
(3) Credit Cooperative Societies
(4) Micro Finance Institutions
(5) Moneylenders

8. The South Asian Free Trade Agreement (SAFTA) was introduced with a view of levying how much custom duty for trading any product within the SAARC zone ?
(1) 5%
(2) 4%
(3) 2%
(4) 1%
(5) No customs duty
9. Which of the following organisations prepares rural credit plans on annual basis for all districts in India, which in turn form the base for annual credit plans of all rural financial institutions ?
(1) SIDBI
(2) NABARD
(3) RBI
(4) Indian Banks Association
(5) CII
10. Which of the following is TRUE about the current population trend (s) in India ?
(A) Every year India adds more people to the world’s population than any other country.
(B) Currently India has a young population which will grow somewhat older largely as a result of decline in fertility.
(C) The National Family Planning Programme did not contribute much in controlling fertility rate.
(1) Only (A)
(2) Only (B)
(3) Only (C)
(4) Only (A) & (B)
(5) All (A), (B) & (C)
11. In economic terms, which of the following factors determine the ‘Individual’s demand’ of a product/ commodity ?
(A) Price of a commodity.
(B) Income of the mdividual.
(C) Utility and quality of a commodity
(1) Only (A)
(2) Only (B)
(3) Only (C)
(4) Only (A) & (C)
(5) All (A), (B) & (C)
12. Which of the following terms is used in the field of economics ?
(1) Adiabatic
(2) Bohr Theory
(3) Plasma
(4) Barter System
(5) Viscosity
13. “Pascal Lamy calls on trade negotiators to move out of their comfort zones towards agreements”, was the headline in some major newspapers. This news is associated with which of the following organisations/agencies ?
(1) World Trade Organisation
(2) International Monetary Fund
(3) World Bank
(4) United Nations Organisation
(5) North Atlantic Treaty Organisation
14. Which of the following is not a function of the Planning Commission of India ?
(1) Assessment of the material, capital and human resources of the country
(2) Formulation of plans for the most effective and balanced utilisation of country’s resources
(3) Public cooperation in national development
(4) Preparation of annual budget of the country and collection of taxes to raise capital for the implementation of the plans
(5) Determination of stages in which the Plan should be carried out
15. Which of the following periods represents the period of the first Five-Year Plan in India?
(1) 1948 – 53
(2) 1947 – 52
(3) 1952 – 57
(4) 1950 – 55
(5) 1951 – 56
16. Which of the following is the name of the process available to common people to seek court’s intervention in matters of public interest ?
(1) Public Interest Litigation (PIL)
(2) Habeas Corpus
(3) Ordinance
(4) Residuary power
(5) None of these
17. India’s foreign policy is based on several principles, one of which is
(1) Panchsheel
(2) Satyamev Jayate
(3) Live and Let Live
(4) Vasudhaiv Kutumbkam
(5) None of these
18. As we know thousands of tonnes of foodgrain was washed away in the floods in Haryana and Punjab a few months back. This incident is an example which indicates that there is a scope for improvement in our machinery controlling our
(1) Mid Day Meal Scheme
(2) Public Distribution System
(3) Food for Work Programme
(4) Village Grain Bank Scheme
(5) Operation Flood Scheme
19. President Barack Obama was on a visit to India a few months back. His visit is said to have forged both the nations into a new era of relations. India managed to sign a special agreement with US in which of the following fields/areas as a byproduct of the visit of Obama ?
(A) Energy sector & Nuclear energy as US has lifted sanctions on supply of high tech machines.
(B) Skill Development Programmes in IT sector in which US has super-specialisation.
(C) Training in management of Micro-finance Institutions.
(1) Only (A)
(2) Only (B)
(3) Only (A) & (C)
(4) Only (B) & (C)
(5) Only (A) & (B)
20. Many times we read a term Tax Haven’ in various newspapers. What does it mean ?
(A) It is a country where certain taxes are levied at a very low rate.
(B) It is a country where people can dump their illegal money without any problem.
(C) It is a place where foreigners can work without paying any tax on their income.
(1) Only (A) & (B)
(2) Only (B)
(3) Only (B) & (C)
(4) Only (A)
(5) All (A), (B) & (C)
21. As per existing law, what is the minimum per day wages paid to a worker from unorganised sector in India ?
(1) Rs. 50
(2) Rs. 75
(3) Rs. 100
(4) Rs. 125
(5) No such law is there
22. Who amongst the following was awarded the “Indira Gandhi Peace Prize” for 2010 ?
(1) Ronald Noble
(2) Luiz Inacio Lula D’Silva
(3) Mohammed ElBaradei
(4) Aung San Suu Kyi
(5) None of these.
23. Which of the following is not a Poverty Eradication Programme launched by the Government of India ?
(1) Swarnjayanti Gram Swarozgar Yojana
(2) Jawahar Gram Samridhi Yojana
(3) National Social Assistance Programme
(4) AADHAAR
(5) National Family Benefit Scheme
24. According to the World Bank estimate about 40% Indians are living below International Poverty line of US $
(1) 1 per day
(2) 1.25 per day
(3) 2 per day
(4) 2.5 per day
(5) 3 per day
25. The 10th Trilateral Ministerial Meeting of RIC group was organised in November 2010. Who are the members of the RIC ?
(1) Russia – Iran – China
(2) Russia – India – China
(3) Romania – Iran – Canada
(4) Romania – Israel – Chile
(5) Russia – India – Croatia
26. India and Syria recently decided to double their trade in next 2 years. Indian Government has decided to export which of the following commodities to Syria ?
(1) Natural gas
(2) Milk
(3) OIL
(4) Wheat
(5) All of these
27. India has sanctioned a Rs. 26 million grant to which of the following countries for development of tube wells ?
(1) Myanmar
(2) Bangladesh
(3) Nepal
(4) Pakistan
(5) Sri Lanka
28. Which of the following is the name of the scheme launched by the Government of India for adolescent girls ? (Launched in November 2010)
(1) Swawlamban
(2) SABALA
(3) AADHAAR
(4) ASHA
(5) None of these
29. Many times we see in financial journals/bulletins a term M3. What is M3 ?
(1) Currency in circulation on a particular day
(2) Total value of the foreign exchange on a particular day
(3) Total value of export credit on a given date
(4) Total value of the tax collected in a year
(5) None of these
30. As per news in various newspapers, Government has allocated a huge sum of Rs. 31,000 crore for ‘RTE’. What is full form of RTE ?
(1) Right to Education
(2) Reforms in Technical Education
(3) Return to Empowerment
(4) Right to Empowerment
(5) Renewable Technology for Energy
31. Which of the following is not a major function of the RBI in India ?
(1) Issuance of currency notes
(2) To facilitate external trade and payment and developing a foreign exchange market in India
(3) Maintaining price stability and ensuring adequate flow of credit to productive sectors
(4) Taking loans/credit from World Bank/IMF and ADB etc. and reallocating it for various activities decided by the Government of India
(5) Formulation and monitoring the monetary and credit policy
32. The RBI has regional offices at various places. At which of the following places it does not have an office ?
(1) Kota
(2) Shimla
(3) Lucknow
(4) Panaji
(5) Guwahati
33. Which of the following organisations/agencies has given a US, $ 407 billion loan to India to boost up its micro finance services in unbanked areas ?
(1) IMF
(2) World Bank
(3) Bank of Japan
(4) ADB
(5) Jointly by IMF and ADB
34. The Prime Minister’s Economic Advisory Council (PMEAC) has projected that the Indian Exports will grow by what percentage during 2010-11 ?
(1) 15%
(2) 18%
(3) 22%
(4) 24%
(5) 28%
35. Which of the following organisations/agencies has given the estimate that India will be third largest FDI recipient in 2010-12 ?
(1) UNCTAD
(2) WTO
(3) World Bank
(4) IMF
(5) None of these
36. The performance of which of the following industries is considered performance of a core industry ?
(1) Garments
(2) Leather
(3) IT
(4) Oil and Petroleum
(5) Handicrafts
37. Who amongst the following is not a recipient of Nobel Prize in economics ?
(1) Peter A. Diamond
(2) Dale T. Mortensen
(3) Amartya Sen
(4) Paul Krugman
(5) Robert G. Edwards
38. Basel Committee has given its recommendations on which of the following aspects of banking operations ?
(1) Marketing of bank products
(2) Priority sector lending
(3) Risk Management
(4) Micro financing
(5) All of these
39. Which of the following is the rank of India in Human Development Report 2010 prepared by the UNO ?
(1) 99
(2) 100
(3) 115
(4) 119
(5) None of these
40. Which of the following was/were the key objectives of the RBI’s review of Monetary and Credit Policy 2010-11 which was reviewed again on 2nd November 2010 ?
(A) To sustain the anti-inflationary thrust.
(B) To maintain an interest rate regime consistent with price.
(C) To provide e^rtra tax incentives to exporters who were in stress due to market fluctuations.
(1) Only (A)
(2) Only (B)
(3) Only (A) & (B)
(4) All (A), (B) & (C)
(5) None of these
41. PUGS is the group of nations falling under
(1) Euro zone
(2) Asia Pacific
(3) SAARC
(4) NATO
(5) Commonwealth
42. Which of the following is / are the preconditions, the IMF has put to provide bail out package to Ireland ?
(A) It should gradually lower down unemployment benefits.
(B) It should bring down the minimum wages in order to boost employment.
(C) It should import some of the crucial commodities from non euro countries as an immediate measure to improve shortage of the same.
(1) Only (A) & (B)
(2) Only (B) & (C)
(3) Only (A) & (C)
(4) Only (A)
(5) All (A), (B) & (C)
43. India is self sufficient in production of which of the following commodities ?
(1) Edible oil
(2) Milk
(3) Pulses
(4) Natural gas
(5) All of these
44. Which of the following is used as a fuel in Nuclear power stations in India ?
(1) Thorium
(2) Copper
(3) Tin
(4) Cromium
(5) All of these
45. Which of the following States has taken up the job of improving Dams with the help of the World Bank’s Dam Rehabilitation and Improvement project ?
(1) Kerala
(2) Gujarat
(3) Tamil Nadu
(4) Uttar Pradesh
(5) Guwahati
46. Nitish Kumar-led National Democratic Alliance won how many seats in recendy held assembly elections in Bihar ?
(1) 150
(2) 243
(3) 200
(4) 206
(5) None of these
47. Who amongst the following is the author of the book “Development as Freedom”?
(1) M. S. Swaminathan
(2) C. Rangarajan
(3) Manmohan Singh
(4) Y.V. Reddy
(5) Amartya Sen
48. Which of the following terms is used in Finance and Banking ?
(1) Line of Sight
(2) Scattering Loss
(3) Revenue
(4) Oscillation
(5) Shielding
49. Who amongst the following is a famous economist ?
(1) Richard Dawkins
(2) Alan Greenspan
(3) Vernon Heywood
(4) Olivar Sachs
(5) Stephen Hawking
50. Who amongst the following has never held post of the Governor of the RBI
(1) C. Rangarajan
(2) L. K. Jha
(3) Manmohan Singh
(4) Bimal Jalan
(5) Usha Thorat

ANSWERS:

1. [4]	6. [5]	11. [5]	16. [1]	21. [3]	26. [4]	31. [4]	36. [4]	41. [1]	46. [4]
2. [3]	7. [5]	12. [4]	17. [1]	22. [2]	27. [5]	32. [1]	37. [1]	42. [5]	47. [5]
3. [4]	8. [5]	13. [3]	18. [4]	23. [2]	28. [5]	33. [2]	38. [3]	43. [1]	48. [3]
4. [3]	9. [2]	14. [4]	19. [5]	24. [1]	29. [1]	34. [3]	39. [4]	44. [1]	49. [2]
5. [4]	10. [1]	15. [5]	20. [2]	25. [2]	30. [1]	35. [1]	40. [3]	45. [1]	50. [5]

Meet on implications of IT in banking

A conference on “Information Technology and its implications on banking sector” will be conducted in Mangalore from April 17-19. A press release by the Department of Postgraduate Studies in Commerce, University College, Mangalore, said here that the conference aims at making analysis of the process of re-inventing the banking system. There will be three plenary and seven technical sessions at the conference.

Banks told to allow customers to use NEFT facility

The Reserve Bank of India has advised all banks to allow their customers to use the National Electronic Funds Transfer (NEFT) facility for repaying loans.

This directive comes as the RBI has received some complaints from customers regarding non-acceptance of NEFT for credit to loan accounts, thereby causing inconvenience to them.

On examination of the customers’ complaints, it was observed that only a few banks were following the restrictive practice of not allowing the use of NEFT for credit to loan accounts. These banks, however, were willingly taking Electronic Clearing System as one of the modes for repayment.

“It is, therefore, advised that all banks should allow the customers to choose NEFT also as one of the electronic modes of making payment towards loan EMIs/repayments, etc,” the RBI said in a statement.

NEFT was launched in 2005. The system is meant for one-to-one funds transfer and can be used for transferring funds to beneficiaries (individual, institutions etc.) and no restrictions have been placed thereon.

In March 2012, the total number of NEFT transactions recorded by the banking system was 2.71 crore for a value aggregating Rs 2.4 lakh crore.

The RBI said that the phenomenal growth in the NEFT system, both in terms of branch coverage and volume/value of transactions handled, reflects the acceptability and popularity of the system.

3,200 MW wind energy capacity added in 2011-12

The Indian Wind Power Association has said 3200 mw of wind power generation capacity was commissioned in the country during 2011-12 in spite of tough times.

Prof. K.Kasthoori Rangaian, Chairman of the association said while the wind industry has been complaining about issues relating to grid in Tamil Nadu, the State topped with a generation capacity addition of 1087 mw capacity.

During his visit to Hyderabad to take part in National Council Meeting of IWPA on Saturday, he said investors are keen to take up wind projects in spite of difficulties, but need support.

Gujarat, Rajasthan, Maharashtra are preferred locations after Tamil Nadu. They have managed to add about 789.85 mw, 546 mw, 418 mw and 1087 mw respectively last year.

Six windy States have made rapid strides with Tamil Nadu having a capacity of 6974 MW, Gujarat following with 2942 MW, Maharashtra (2735 MW), Rajasthan (2068 MW), Karnataka (2934 MW) and Madhya Pradesh (314 MW).

The Association has requested the Andhra Pradesh Government to support them in implementing more projects by offering higher tariffs and permitting trading in Renewable Energy Certification by entering into agreements.

Banks fail the ‘deposits' test after seven years

For six long years, the Indian banking industry has had no difficulty in collecting a larger sum as fresh deposits than the previous year.

That record had been broken in 2011-12 with the industry failing to match the collections of 2010-11.

For the year ended March 2012, banks added Rs 6.95 lakh crore to their deposit base, a decline from the figure of Rs 7.15 lakh crore garnered in 2010-11.

The shortfall in fresh mobilisation also resulted in the growth rate declining from 16 per cent in 2010-11 to a little over 13 per cent in the fiscal year just gone by. The decline has come about despite a trend of rising interest rate that began in the later part of 2010-11 being sustained through the whole of 2011-12.

For instance, State Bank of India's three-year deposit rate was 6.5 per cent in August 2010. The current deposit rate for a similar term now is 9.25 per cent.

Many alternatives

There is also evidence of investors making use of other options fetching higher rates of returns. The year 2011-12 saw quite a few debt instruments especially from non-banking finance companies hitting the market. Gold inflows have seen an upsurge.

Non-banking finance companies raised nearly Rs 6,400 crore by way of bond issues in 2011-12, offering yields of 10-13 per cent.

Additionally, another Rs 30,000 crore flowed into tax-free bonds issued by entities such as NHAI. Infrastructure bonds which offered tax exemption on the value of investment were also raised during this period. The data on the exact quantum of money raised arenot known as yet.

There is also evidence that investors put more money into physical assets such as gold. Data from the World Gold Council show that Indians poured roughly Rs 1.58 lakh crore into gold in first nine months of 2011-12, a 15 per cent jump over last year. The trend of increasing preference witnessed in 2010-11 (45 per cent) has been sustained in 2011-12.

Investors are continuously chasing avenues to better their returns on savings is clear from two distinct pieces of data.

Small savings schemes suffered an outflow of Rs 7,000 crore. Even within the pool of sums invested in banks investors have shifted more monies from savings bank accounts to term deposits to earn a higher yield. Inflation in the economy, as measured by rise in consumer prices, was close to 8 per cent in 2011-12.

With deposit inflows flagging banks are raising their interest rates once again. About 20 banks have raised their deposit rates in the last two months. The banks' credit:deposit ratio too is at a all-time high of 78 per cent.

Reserve Bank of India released the Fair Practices Code for NBFCs

The Reserve Bank of India on 26 March 2012 restructured the fair practices code (FPC) to be adopted by non-banking finance companies (NBFCs) while doing lending business. The guidelines issued by the central bank covered general principles on adequate disclosures on the terms and conditions of a loan and also adopting a non-coercive recovery method.

The modified FPC is required to be put in place by all NBFCs with the approval of their boards within one month from the date of issue of this circular (26 March 2012). Also RBI directed that the FPC should be published and disseminated on the web-site of the company for public information.

NBFCs were however granted the freedom of drafting the FPC, enhancing the scope of the guidelines. It is however not to contradict the spirit dominating the guidelines. The RBI directed NBFCs to mention the penal interest charged for late repayment in bold in the loan agreement. Also the NBFCs were directed not to resort to undue harassment such as persistently bothering the borrowers at odd hours and use of muscle power with respect to loan recovery.

The RBI had in 2006 issued FPC norms for all NBFCs to be adopted by them while doing the lending business. It had also covered norms on adequate disclosures on terms and conditions of a loan, and also adopting a non-coercive recovery method.

Zero Inflation

Inflation is the measure of rise in general prices in any economy over a given period of time.  Normally inflation is measured every week, but for the policy purposes its annual measure is taken into account. Inflation is measured by the government by considering the changes in wholesale price index and those in the consumer price index over the given period of time.

 

Inflation is of several types and the ‘creeping’ or ‘walking’ inflation of upto 5 per cent per annum is called functional inflation and considered good for the health of growing economies. Running, galloping and hyper inflation is bad for the economy as it also erodes the real income level of the poorer sections of the emerging economies, thereby making their livelihood even more difficult. Hence, in a developing economy, the government policies aim at keeping the inflation rate within the functional limits.

 

Due to increased prices of the food items, India, along with most parts of the world, faced high inflation rate in double digits during the middle of 2008, which could be termed as ‘running’ inflation. The government took several monetary and fiscal policy measures to control it and succeeded to bring it down. But in early 2009 a peculiar phenomenon was experienced. In March 2009, the inflation rate in the country went down as low as 0.44 per cent, a sudden drop from 2.43 per cent during the week prior to that. This has given rise to the speculation that the country may experience zero inflation rate. The apprehensions are that zero rate of inflation would act as discouragement to the new investors, who are likely to put on hold their new projects, which would affect the growth rate of the economy. Zero inflation reduces the level of profits drastically. Such a situation, though may be cheered by the consumers and benefit the poorer sections spending most of their earnings on consumption, yet may actually reduce the economic activity in the economy to the minimum. This may be harmful to the economy in the medium and long run.

Bank of Baroda opened 1001 Ultra Small Branches Across India

Bank of Baroda, the public sector lender, on 22 March 2012 launched 1001 ultra small branches to provide banking services to the people of villages which don’t have access to banling services. The bank launched the ultra small branches under the financial inclusion initiative.
The virtual launch of 1001 ultra small branches was done by K. C. Chakraborty, Deputy Governor, Reserve Bank of India, in the presence of M. D. Mallya, Chairman and Managing Director, Bank of Baroda, at Varanasi.
On the same day, 551 ultra small branches were inaugurated across Uttar Pradesh and Uttarakhand. Bank of Baroda is set to open 1700 ultra small branches in various villages across the country.

BANKING AWARENESS PRACTICE QUESTIONS

1. RBI’s open market operation transactions are carried out with a view to regulate ____
(A) Liquidity in the economy
(B) Prices of essential commodities
(C) Inflation
(D) Borrowing power of the banks
(E) All the above

Ans (E) 

2. Open market operations , one of the measures taken by RBI in order to control credit expansion in the economy me
Ans ____
(A) Sale or purchase of Govt. securities
(B) Issuance of different types of bonds
(C) Auction of gold
(D) To make available direct finance to borrowers
(E) None of these

Ans (A)

3. The bank rate me
Ans ___
(A) Rate of interest charged by commercial banks from borrowers
(B) Rate of interest at which commercial banks discounted bills of their borrowers
(C) Rate of interest allowed by commercial banks on their deposits
(D) Rate at which RBI purchases or rediscounts bills of exchange of commercial banks
(E) None of these

Ans (D)

4. What is an Indian Depository Receipt?
(A) A deposit account with a Public Sector Bank
(B) A deposit account with any of depositories in India
(C) An instrument in the form of depository receipt created by an Indian depository against
underlying equity shares of the issuing company
(D) An instrument in the form of deposit receipt issued by an Indian depositories
(E) None of these

Ans (C)

5. Fiscal deficit is ____
(A) total income less Govt. borrowing
(B) total payments less total receipts
(C) total payments less capital receipts
(D) total expenditure less total receipts excluding borrowing
(E) None of these

Ans (D)

6. In the capital market , the term arbitrage is used with reference to ____
(A) purchase of securities to cover the sale
(B) sale of securities to reduce the loss on purchase
(C) simultaneous purchase and sale of securities to make profits from price
(D) variation in different markets
(E) Any of the above

Ans (C)

7. The stance of RBI monetary policy is _____
(A) inflation control with adequate liquidity for growth
(B) improving credit quality of the Banks
(C) strengthening credit delivery mechanism
(D) supporting investment demand in the economy
(E) Any of the above

Ans (E)

8. Currency Swap is an instrument to manage ___
(A) currency risk
(B) interest rate risk
(C) currency and interest rate risk
(D) cash flows in different currency
(E) All of the above

Ans (D)

9. "Sub-prime" refers to_______
(A) lending done by banks at rates below PLR
(B) funds raised by the banks at sub - Libor Rates
(C) Group of banks which are not rate as prime banks as per Banker's Almanac
(D) lending done by financing institutions including banks to customers not not meeting with
normally required credit appraisal standards
(E) All of the above

Ans (D)

10. Euro Bond is an instrument _____
(A) issued in the European market
(B) issued in Euro currency
(C) issued in a country other than the country of the currency of the Bond
(D) All of the above
(E) None of these

Ans (C)

11. Money laundering normally involves _____
(A) placement of funds
(B) layering of funds
(C) integrating of funds
(D) All of (A), (B) & (C)
(E) None of (A), (B) & (C)

Ans (D)

12. The IMF and the World Bank were conceived as institutions to ____
(A) strengthening international economic co-operation and to help create a more stable and
prosperous global economy
(B) IMF promotes international monetary cooperation
(C) The World Bank promotes long term economic development and poverty reduction
(D) All of (A),(B) & (C)
(E) None of (A),(B) & (C)

Ans (D)

13. Capital Market Regulator is _____
(A) RBI
(B) IRDA
(C) NSE
(D) BSE
(E) SEBI

Ans (e)

14. In the term BRICS , R stands for ______
(A) Romania
(B) Rajithan
(C) Russia
(D) Regulation
(E) Npne of these

Ans (C)

15. FDI refers to _____
(A) Fixed Deposit Interest
(B) Fixed Deposit Investment
(C) Foreign Direct Investment
(D) Future Derivative Investment
(E) None of these

Ans (C)

16. Which is the fist Indian company to be listed in NASDAQ?
(A) Reliance
(B) TCS
(C) HCL
(D) Infosys
(E) None of these

Ans (D)

17. Which of the following is the Regulator of the credit rating agencies in India?
(A) RBI
(B) SBI
(C) SIDBI
(D) SEBI
(E) None of these

Ans (D)

18. Who is Brand Endorsing Personality of Bank of Baroda?
(A) Juhi Chawala
(B) Kiran Bedi
(C) Amitabh Bachchan
(D) Kapil Dev
(E) None of these

Ans (E)

19. The Branding Line of Bank of Baroda is ____
(A) International Bank of India
(B) India's International Bank
(C) India's Multinational Bank
(D) World's Local Bank
(E) None of these

Ans (B)

20. The logo of Bank of Baroda is known as ___
(A) Sun of Bank of Baroda
(B) Baroda Sun
(C) Bank of Baroda's Rays
(D) Sunlight of Bank of Baroda
(E) None of these

Ans (B)

21. One of the major challenges banking industries is facing these days is money laundering. Which of the following acts/ norms are launched by the banks by the banks to prevent money laundering in general ?
(A) Know your customer norms
(B) Banking Regulation Act
(C) Negotiable Instrument Act
(D) Narcotics and Psychotropic Substance Act
(E) None of these

Ans (E)

22. Lot of Banks in India these days are offering M-Banking Facility to their customers . What is the full form of 'M' in 'M-Banking'?
(A) Money
(B) Marginal
(C) Message
(D) Mutual Fund
(E) Mobile Phone

Ans (E)

23. Which of the following is/are true about the "Sub-Prime Crisis" ? (The term was very much in news recently.)
(1) It is a Mortage Crisis referring to Credit default by the borrowers
(2) Sub-Prime borrowers were those borrowers who were rated low and were high risk borrowers
(3) This crisis originated of negligence in credit rating of the borrowers
(A) Only 1
(B) Only 2
(C) Only 3
(D) All 1,2 & 3
(E) None of these

Ans (D)

24. Which of the following is NOT the part of the structure of the financial System in India ?
(A) Industrial Finance
(B) Agricultural Finance
(C) Government Finance
(D) Development Finance
(E) Personal Finance

Ans (E)

25. Which of the following is NOT the part of the Scheduled Banking structure in India ?
(A) Money Lenders
(B) Public Sector Banks
(C) Private Sector Banks
(D) Regional Rural Banks
(E) State Co-operative Banks

Ans (A)

26. As we all know Govt. of India collects tax revenue on various activities in the country. Which of the following is a part of the tax revenue of the Govt. ?
(1) Tax on Income
(2) Tax on Expenditure
(3) Tax on property or Capital Asset
(4) Tax on Goods and Services
(A) Both 1 and 3 only
(B) Both 2 and 4 only
(C) All 1,2,3 & 4
(D) Only 2,3 and 4
(E) None of these

Ans (C)

27. We very frequently read about Special Economic Zones (SEZs) in newspapers. These SEZs were established with which of the following objectives ?
(1) To attract foreign investment directly
(2) To protect domestic market from direct competition from multinationals
(3) To provide more capital to agriculture and allied activities
(A) Only 1
(B) Only 2
(C) Only 3
(D) All 1,2 & 3
(E) None of these

Ans (A)

28. Which of the following groups of the countries has almost 50% share in Global emission of carbon every year ?
(A) US, China, India, South Africa
(B) India, china, Russia , Britain
(C) South Africa, Nepal , Myanmar
(D) US, Russia, China & India
(E) None of these

Ans (D)

29. Many times we read about Future Trading in newspapers. What is Future Trading ?
(1) It is nothing but a trade between any two stock exchanges where in it is decided to purchase the stocks of each other on a fixed price throughout the year
(2) It is an agreement between two parties to buy and sell an underlying asset in the future at a predetermined price

(3) It is agreement between Stock Exchanges that they will not trade the stocks of each other under any circumstances in future or for a given period of time
(A) Only 1
(B) Only 2
(C) Only 3
(D) All 1,2 & 3
(E) None of these

Ans (B)

30. Hillary Clinton formally suspended her campaign to ensure election of who amongst the following for the next President of USA?
(A) George Bush
(B) Barack Obama
(C) John McCain
(D) Boll Clinton
(E) None of these

Ans (B)

31. Hugo Chavez whose name was recently in news is the _____
(A) President of Cango
(B) Prime Minister of Uganda
(C) President of Venezuela
(D) Prime Minister of Brazil
(E) None of these

Ans (C)

32. The Govt. of India has raised the amount of the loan Waiver to the farmers by 20%. Now the amount is nearly _____
(A) Rs. 60,000 crores
(B) Rs. 65,000 crores
(C) Rs. 72,000 crores
(D) Rs. 76,000 crores
(E) Rs. 80,000 crores

Ans (A)

33. Delimitation Commission has made a recommendation the next Census should be Panchayat-wise. When is the next Census due ?
(A) 2010
(B) 2011
(C) 2012
(D) 2013
(E) 2015

Ans (B)

34. The world Health Organization has urged that advertisements of which of the following should be banned to protect youth from bad effects of the same ?
(A) Tobacco
(B) Alcoholic drinks
(C) Junk Food
(D) Soft drinks with chemical preservatives
(E) None of these

Ans (A)

35. Which of the following countries has allocated a huge amount of US $ 10 billion to provide relief to its earthquake victims ?
(A) Japan
(B) South Korea
(C) China
(D) South Africa
(E) None of these

Ans (C)

36. Which of the foloowing names is NOT closely associated with space Programme of India or any other country ?
(A) CARTOSAT
(B) NLS-5
(C) RUBIN-8
(D) GSLV
(E) SCOPE

Ans (E)

37. Vijay Hazare Trophy is associated with game of _____
(A) Hockey
(B) Cricket
(C) Badminton
(D) Football
(E) Golf

Ans (B)

38. Which of the following was theme of the Olympic Torch ?
(A) Journey of Harmony
(B) Green World Clean World
(C) Journey of Peace
(D) Jouney of Hunger-free World
(E) None of these

Ans (A)

39. Which of the following schemes is NOT a social development Scheme ?
(A) Indira Awas Yojana
(B) Mid Day Meal
(C) Bharat Nirman Yojana
(D) Sarva Siksha Abhiyan
(E) All are Social Schemes

Ans (C)

40. Which of the following is NOT a member of ASEAN ?
(A) Maleysia
(B) Indonesia
(C) Vietnam
(D) Britain
(E) Singapore

Ans (D)

41. Which of the following awards are given for the excellence in the field of Sports ?
(A) Kalinga Prize
(B) Shanti Swarup Bhatnagar Award
(C) Arjun Award
(D) Pulitzer Award
(E) None of these

Ans (C)

42. Inflation in India is measured on which of the following indexes/indicators ?
(A) Cost of Living Index (COLI)
(B) Consumer Price Index (CPI)
(C) Gross Domestic Product (GDP)
(D) Wholesale Price Index (WPI)
(E) None of these

Ans (D)

51. As a policy to boost the agricultural sector in the country, the Govt. of India has taken several special measures over the years. Which of the following cannot be considered a measure/ measures which will have a direct impact(s) on the agricultural sector ?
1. Setting up of a National Food Processing Bank.
2. Opening irrigation, sanitation and water projects for development under public private participation.
3. Efforts to bring down fiscal deficit to 5.5 per cent level of GDP.
(A) Only 1
(B) Only 2
(C) Only 3
(D) Only 1 and 2
(E) All 1, 2 and 3

Ans : (C) 

52. The Govt. of India is plannning to bring a Second Green Revolution. This will be launched specifically for which of the following parts of the country ?
(A) North East and Eastern Regions
(B) Central India
(C) Jammu & Kashmir
(D) Tamil Nadu, Kerala and Andhra Pradesh
(E) None of these

Ans : (A)

3. As we all know, the limit of exemption on personal income tax has been raised by Rs. 10,000. Whenever a relief in direct taxes is given, the underlying motive is always to make money available for which of the following purposes ?
1. Savings
2. Investment for High returns
3. Personal Consumption
(A) Only 1
(B) Only 2
(C) Only 1 and 3
(D) Only 2 and 3
(E) None of these

Ans : (C)

54. As we know, a special scheme ‘One Village One Project’ is in vogue in some parts of our country and has proved a good incentive to boost the rural economy and the agricultural sector. Now the Govt. has decided to develop 60,000 villages to produce which of the following single crops as a major crop ?
(A) Pulses or Oilseeds
(B) Wheat or Bajra
(C) Sugar or Jute
(D) Sunflower or Rose flower
(E) None of these

Ans : (A)

5. The Govt. of India has decided to bring down the fiscal deficit from 6.6 per cent to the level of 5.5 per cent of the GDP so that it can meet growth targets well in time. This target of 5.5 per cent is to be achieved by the end of—
(A) January 2011
(B) March 2011
(C) December 2010
(D) January 2012
(E) None of these

Ans : (D)

56. Some economists and financial experts are of the opinion that the Finance Minister of India has done a good job by allocating a fairly good share of budget to ensure that the benefits of the growth also reach the poor and unorganized sectors of the society. What amount in terms of percentage has been allocated to various schemes of the social sector in the Union Budget 2010-11 ?
(A) 5%
(B) 7.5%
(C) 10%
(D) 12.5%
(E) None of these

Ans : (E)

57. Many people talk about the roll back of stimulus packages provided last year by the Govt. of India to help certain sectors. If these stimulus packages are rolled back, this would mean that—
1. those who have availed these benefits would be required to return them to the Govt. of India.
2. no such incentive would be available henceforth to these sectors.
3. all such benefits/incentives would be available to all the people across the country and will not be
restricted to some selected few.
(A) Only 1
(B) Only 2
(C) Only 3
(D) Only 1 and 3
(E) Only 2 and 3

Ans : (C)

58. In order to develop infrastructure in the country at a faster pace, the Govt. of India has
fixed some targets. In order to achieve this target, at present, how many kilometers of
highway is required to be constructed per day ?
(A) 5 km
(B) 10 km
(C) 15 km
(D) 20 km
(E) None of these

Ans : (D)

59. “South India will get K-G gas by 2012” was the news in a major financial newspaper. ‘K-G’ is the abbreviated name of which of the following ?
(A) Karnataka-Goa
(B) Kaveri-Ganga
(C) Krishna-Godavari
(D) Karnataka-Gulf
(E) None of these

Ans : (C)

60. Many a times, we read in newspapers that some big banks have revised their lending rates to make them dearer or cheaper. Though the decision to raise the lending rates is always in the hands of the banks normally they announce this decision of theirs—
1. immediately after the Union Budget is presented in the Lok Sabha every year.
2. when the RBI makes changes in its policy rates.
3. when the Monetary and Credit Policy of the RBI is reviewed periodically.
(A) Only 1
(B) Only 2
(C) Only 3
(D) Only 2 and 3
(E) All 1, 2 and 3

Ans : (C)

61. How much amount in cash is the Govt. of India planning to infuse in public sector banks, to strengthen their capital base this year ?
(A) Rs. 10,000 crore
(B) Rs. 12,500 crore
(C) Rs. 14,000 crore
(D) Rs. 16,500 crore
(E) None of these

Ans : (E)

62. As we all know, the rate of MAT has been increased from the present 15% to 18% with
effect from April 2010. What is the full form of MAT ?
(A) Maximum Alternate Tax
(B) Minimum Alternate Tax
(C) Minimum Affordable Tax
(D) Maximum Affordable Tax
(E) None of these

Ans : (B)

63. One of the headlines in a major financial newspaper recently was “Is Spain the next Greece or Italy or Portugal ?” What is the actual meaning of this headline because of which the author has been comparing Spain with the other three countries ?
(A) All these three countries have abandoned the membership of the European Union. Spain is also planning to do so
(B) All these three countries were the first to come out of recent global recession and that too within a short span of time. Spain is next in queue to declare itself free from the trouble
(C) These three nations are badly trapped in a situation where their economy is proceeding from bad to worse condition. Spain also appears to be in the same situation
(D) Greece, Itlay and Portugal have signed some special agreements with US and are availing stimulus packages to promote their exports to US on some specific terms. Spain is also willing to do the same
(E) None of these

Ans : (C)

64. Many times we read in newspapers that several companies are adopting the FCCBs route to raise capital. What is the full form of FCCBs ?
(A) Foreign Currency Convertible Bonds
(B) Foreign Convertible Credit Bonds
(C) Financial Consortium and Credit Bureau
(D) Future Credit and Currency Bureau
(E) None of these

Ans : (A)

65. The Govt. of India has asked all big companies and corporates to create a separate fund
for their ‘Corporate Social Responsibility Activities’. What is/are the purpose(s) of this
directive issued by the Govt. ?
1. To ensure that companies spend some money on social activities.
2. To bring tr
Ansparency in matters of financial tr
Ansactions and dealings by corporates.
3. To ensure that corporate entities do not get involved in non commercial activities in the name of social activities as they are required to spend money only on the welfare of the employees and their families.
(A) Only 1
(B) Only 2
(C) Only 3
(D) All 1, 2 and 3
(E) None of these

Ans : (B)

66. Which of the following is an innovative mechanism adopted by banks to meet the targets fixed for lending to priority sector by the Banks ?
(A) Buying & Selling of Priority Sector Lending Certification
(B) Sale of Kisan Vikas Patra
(C) Inter Bank Participation Certificates
(D) Adoption of Core Banking Solution
(E) None of these

Ans : (C)

67. The Reserve Bank of India (RBI) recently announced a hike in some policy rates and also indicated that there may be another change in near future. Which of the following is/are considered a policy rate(s) in the hands of the RBI ?
1. Repo Rate
2. SLR
3. Inflation
(A) Only 1
(B) Only 2
(C) Only 3
(D) Only 1 and 2
(E) All 1, 2 and 3

Ans : (D)

68. Zain, which was in news recently, is a company based in which of the following nations ?
(A) Kuwait
(B) South Africa
(C) UAE
(D) China
(E) None of these

Ans : (A)

69. Who amongst the following was awarded the prestigious ‘Moortidevi Award’ recently for his literary works ? (Awardee is a Minister in the Union Cabinet)
(A) Veerappa Moily
(B) Pranab Mukherjee
(C) P. Chidambaram
(D) Kapil Sibal
(E) None of these

Ans : (A)

70. The Indian Ministry of Agriculture has decided that despite good stocks of wheat and rice, India will not export the excess stocks. Which of the following may be the reason(s) owing to which the Ministry has taken this decision ?
1. Indian wheat and rice are not in much demand in foreign countries. Hence, very few are takers for the same.
2. The National Food Security Bill has a provision to provide 25 kg of wheat or rice to the families living below poverty line. A huge stock of grains will be needed for the same in near future.
3. Since most countries are still to recover from the global recession, a formula is being worked out where imports and exports will be compensated simply by exchange of commodities available with the countries. India is planning to use its food grain stocks for the same.
(A) Only 1
(B) Only 2
(C) Only 3
(D) All 1, 2 and 3
(E) None of these

Ans : (B)

71. As per the reports published in various newspapers, RBI has asked banks to make a plan to provide banking services to all villages having a population of 2000. This directive issued by the RBI will fall in which of the following categories ?
(A) Plan for Financial Inclusion
(B) Efforts to meet the targets of Priority Sector Lending
(C) Extension of Relief Packages to the Farmers
(D) Extensions of Internal and Branchless Banking
(E) None of these

Ans : (A)

72. Which of the following is not a bank or finance company ?
(A) Barclays
(B) BNP Paribas
(C) Lufth
Ansa
(D) HSBC
(E) All are banks/finance companies

Ans : (C)

73. The Indian Railways is in the process of purchasing Bullet Train Technology from which of the following nations ?
(A) France
(B) China
(C) Japan
(D) Russia
(E) Spain

Ans : (C)

74. Some State Govts. have started a project ‘Save Snow Leopards’. Snow Leopards are found mainly in—
(A) Jammu & Kashmir
(B) Rajasthan
(C) Kerala
(D) Punjab
(E) Tamil Nadu

Ans : (A)

75. India recently signed an agreement for an ‘Action Plan to Advance Security Cooperation’ with which of the following nations ?
(A) China
(B) Bangladesh
(C) Pakistan
(D) Nepal
(E) Japan

Ans : (E)

76. Sanya Richards who was named as the IAAF World Athlete of 2009 represents which of the following countries ?
(A) Jamaica
(B) Kenya
(C) France
(D) Britain
(E) USA

Ans : (E)

77. Who amongst the following was adjudged the European Footballer of the year 2009 ?
(A) Roberto Baggio
(B) Edger Davids
(C) Xavi Hamandez
(D) Cristiano Ronaldo
(E) Lionel Messi

Ans : (E)

78. The latest nuclear power reactor of India recently attained criticality at Rawatbhata. Rawatbhata is a place in—
(A) Uttar Pradesh
(B) Madhya Pradesh
(C) Uttarakhand
(D) Orissa
(E) Rajasthan

Ans : (E)

79. Who amongst the following has recently received the Highest Civilian Honour of France ?
(A) Kareena Kappor
(B) A. R. Rahman
(C) Javed Akhtar
(D) Lata Mangeshkar
(E) None of these

Ans : (D)

80. Who amongst the following represented India at the 15th United Nations Climate Change Conference 2009 held in Copenhagen ?
(A) Smt. Sonia Gandhi
(B) Smt. Pratibha Patil
(C) Dr. Manmohan Singh
(D) Smt. Meira Kumar
(E) None of these

Ans : (C)

81. Three Indian sportsmen, C. Raju Srither, I.R. Sanam and Ratan Singh recently went to Indonesia and won Gold Medals in one of the events. All three are associated with which of the following sports ?
(A) Weightlifting
(B) Rifle Shooting
(C) Swimming
(D) Golf
(E) Archery

Ans : (E)

82. A two-day meeting of the South Asian Association for Regional Cooperation (SAARC) was organized recently in—
(A) Thimpu
(B) Islamabad
(C) Kabul
(D) Dhaka
(E) New Delhi

Ans : (A)

83. By nominating its Ambassador to which of the following countries after a gap of five years has the USA established its diplomatic relation with it ?
(A) Syria
(B) Iran
(C) Iraq
(D) China
(E) None of these

Ans : (A)

84. Which of the following organizations/ agencies is providing a US $ 850 million loan to India for the development of its infrastructure and Khadi industry ?
(A) World Bank
(B) European Union Finance Corporation
(C) Asian Development Bank
(D) Govt. of South Africa
(E) None of these

Ans : (C)

86. The census in India is done after a gap of every—
(A) 5 years
(B) 10 years
(C) 12 years
(D) 15 years
(E) None of these

Ans : (B)

87. Pankaj Advani won which of the following titles in the year 2009 ?
(A) Asian Games Gold Medal
(B) Asian Billiards Championship
(C) WSA Challenge Tour
(D) World Professional Billiards Championship
(E) None of these

Ans : (D)

88. Which of the following awards is given for Excellence in the field of sports ?
(A) Kalinga Award
(B) Golden Pen Award
(C) Arjuna Award
(D) Bharat Ratna
(E) None of these

Ans : (C)

89. Which of the following states started ‘April Mandis’ project in all districts of the state to ensure the supply of vegetables and fruits at fair prices ?
(A) Gujarat
(B) Uttar Pradesh
(C) Haryana
(D) Delhi
(E) None of these

Ans : (C)

90. Which of the following terms is not used in Economics ?
(A) Balanace of Trade
(B) Centrifugal force
(C) Break even
(D) Fiscal Deficit
(E) Capital Account

Ans : (B)

91. The Indira Gandhi Peace Prize 2009 was given to the President of—
(A) Fiji
(B) Bhutan
(C) Nepal
(D) Bangladesh
(E) None of these

Ans : (D)

92. The Govt. of India recently launched the Jawaharlal Nehru National Solar Mission. This mission is one of the key missions on India’s National Action Plan on—
(A) Second Green Revolution
(B) Climate Change
(C) Recharging of Water bodies
(D) Electricity to all
(E) None of these

Ans : (B)

93. Voting in local bodies elections is compulsory in which one of the following states ?
(A) Delhi
(B) Maharashtra
(C) Kerala
(D) Gujarat
(E) None of these

Ans : (D)

94. India’s exports of which of the following to USA has been growing at a fast pace despite the global slowdown and recession ?
(A) Handicrafts and Carpets
(B) Textiles and Clothing
(C) Horticultural products
(D) Foodgrains
(E) Services

Ans : (E)

95. Russia recently agreed to resume import of natural gas from which of the following countries after a gap of about a month following a dispute over prices of the same ?
(A) Iran
(B) Turkmenistan
(C) China
(D) Kazakhstan
(E) N. Korea

Ans : (B)

96. India recently signed an agreement for cooperation in the field of nuclear power for civil purposes. This agreement is free from any restrictions on India. India signed this agreement with—
(A) France
(B) Germany
(C) USA
(D) Canada
(E) Russia

Ans : (E)

97. ‘Between the Assassinations’ is a book written by—
(A) Chetan Bhagat
(B) Kiran Desai
(C) Shobha De
(D) Vikram Seth
(E) Arvind Adiga

Ans : (E)

8. Which of the following prizes/ awards is not given for Excellence in the field of Literature ?
(A) Dronacharya Award
(B) Aga Khan Prize for Fiction
(C) Commonwealth Award
(D) Nobel Prize
(E) Man Booker Prize

Ans : (A)

99. Which of the following terms is not used in the game of Hockey ?
(A) Centre
(B) Downswing
(C) Drop pass
(D) Goal line
(E) Blue line

Ans : (B)

100. ‘Invisible’ is a novel written by—
(A) Vikram Seth
(B) Chetan Bhagat
(C) Anita Desai
(D) Meghnad Desai
(E) Paul Auster

Ans : (E)

BANKING AWARENESS PRACTICE MCQs

1. Which of the following statements is true?
a) The licence to open branches of bank is granted by Board of Directors of that Bank
b) There is no need of licenses to open branch of a bank
c) A licence to open a branch is issued by the Central Government
d) A licence to open a branch is issued by the Reserve Bank of India under the provisions of Banking Regulation Act, 1949

2. The important condition for granting licence of banking companies is?
a) Banking company need not plan to pay for future depositors
b) Banking company can plan for its capital structure once the licence is granted
c) The business undertaken by the banking company should not frustrate the interest of public
d) The banking company can undertake business other than banking with the permission of annual general body

3. Who of the following is not a party to the IPO?
a) Registrar of Issue
b) Investment Banker
c) Advertisement Agency
d) Registrar of Companies

4. Which of the following is not shown as an asset in the balance sheet of a Bank?
a) Investments
b) Advances
c) Cash Balances with other banks
d) Borrowings

5. The credit policy of a bank does not consists of?
a) Lending policies
b) Quality control
c) Loan product mix
d) Advertising of loan products

6. Which of the following is a function of the agent bank relating to flow of money in the process of loan syndication?
a) Receiving notices relating to cancellation of any part of the loan
b) Calling of loans in the event of default
c) Receiving the fee from the borrower and distributing among the participating banks
d) Receiving notices relating to transfers of banks


7. Which of the following is the parameter to recognize the SSI unit as sick unit?
a) The erosion in the net-worth due to accumulated losses is up to 25% of its net worth during the previous account year
b) The erosion in the net-worth due to accumulated losses is up to 50% of its net worth during the previous account year.
c) The unit should have been in commercial production for at least five years
d) Lack of updations in technological development

8. Which of the following is not the service provided by the Small Industries Service Institute?
a) Providing entrepreneurship development programs
b) Developmental efforts
c) Export promotion and liaison activities
d) Financial support

9. Service Area Approach (SAA) is associated with?
a) Rural and Semi-urban branches of commercial banks
b) Urban branches of commercial banks
c) Branches of commercial banks situated in metro cities
d) Development banks

10. Which of the following cannot be securitized?
a) Future rentals of a fishing boat
b) Hire purchase receivables
c) Demand drafts received by the banker during clearing
d) Future billings for an airline

11. Which of the following statements is true?
a) The special purpose vehicle (SPV) purchases the assets from the borrower directly during the securitization
b) The originator and obligor are the same persons in securitization process
c) Administrator collects the payments due from the obligor and passes it to the SPV and follows with defaulters
d) Mortgage based securitization provides high yields to the investor

12. The important feature of an anticipatory letter of credit is that?
a) The letter of credit can be used as back- to- back letters of credit
b) The beneficiary under the letter of credit may receive payment even at the pre-shipment stage
c) The beneficiary under the letter of credit may receive payment even at the post-shipment stage
d) The cash advance is not permitted against such letter of credits

13. The Shipping guarantee is a?
a) Type of a letter of credit
b) Guarantee issued by the ship captain to the purchaser
c) Guarantee issued to the borrower towards the loan granted by the shipping company
d) Deferred payment guarantee issued by a banker at the request of the consignee when the documents are not received and goods are received, for facilitating the delivery of goods.

14. Which of the following statements is true?
a) The charge card is a credit instrument
b) Under this facility the cardholders need to pay amount within ten installments
c) Cardholder has to pay the 100% of the purchase amount within 30 days of purchase
d) The charge card shall have revolving credit

15. Which of the following is not augmented feature of a credit card?
a) Personal accident insurance
b) Cash withdrawals
c) Add-on facility
d) Issue of deferred guarantee

16. Which of the following is the disadvantage of going for public issue?
a) Liquidity to existing shares
b) Increase in visibility and reputation to the company
c) Better pricing and placement with new investors
d) Need to make continuous disclosures

17. Which of the following is not a criterion to select the Investment Bankers?
a) No professional memberships or incorporations are required
b) General reputation in the market
c) Good rapport with market intermediaries
d) Distribution net work of the organization

18. Which of the following is not an asset of a bank?
a) Notes and small coins
b) Overdue recurring deposits
c) Short term loans
d) Staff advances

19. The banking company has restriction to sanction loan to?
a) Directors of the bank
b) Staff working in the bank
c) Students going abroad
d) Professionals

20. Which of the following is a non-depository institution?
a) Credit unions
b) Commercial banks
c) Mutual funds
d) Regional rural banks

21. The disadvantage associated with leasing company is?
a) Low costs
b) Flexibility in payments
c) Eliminates the risk of obsolescence
d) High competitions because of entry to all financial institutions

22. Which of the following theory is associated with the financial system in the economic growth?
a) Retributive theory
b) Reformative theory
c) Financial repression theory
d) Jurisdictional theory

23.Which of the following is not a financial intermediary in the financial markets?
a) Pension funds
b) Credit unions
c) Life insurance companies
d) Small scale service institute.

24 Which of the following is not a function of a commercial bank?
a) Registration of charges and mortgages
b) Transactions services
c) Asset transaction
d) Real-time Gross Settlement

25. Which of the following is one of the three pillars of new Basel Capital Award?
a) Market competitions
b) Market rapport
c) Market discipline
d) International market relations

26. The interest in savings bank accounts of a bank is calculated on?
a) Minimum amount of balance that is maintained in the account in between 10th and the last day of month
b) Maximum amount of balance that is maintained in the account in between 10th and the last of month
c) Minimum amount of balance that is maintained in the account in between 1st and the last day of month
d) Maximum amount of balance that is maintained in the account in between 1st and the last of month

27. The credit policy of a bank does not deal with?
a) Credit risk management
b) Documentation standards
c) Review and renewal of advances
d) Outstanding balances in deposit accounts

28. Issuing credit cards is a component of ?
a) Corporate banking
b) Rural banking
c) Retail banking
d) Micro finance

29. The origin of bank instruments can be traced to?
a) The priests and worship places of public deposits
b) Goldsmith receipts
c) Bonds issued by the British Government in India
d) Bank notes issued by Bank of Venice

30. Which of the following is not the function of commercial banks?
a) Providing transaction services
b) Intermediation in financial services
c) Providing transformation services
d) Regulating the issue of bank notes.

31 Which of the following is the most important challenge before the commercial bank?
a) Maintenance of foreign currency
b) Evaluating the need of the customers
c) Maintenance of SLR and CRR
d) Meet the technological revolution

32. The asset's side of balance sheet consists of ?
a) Cash balances with other banks
b) Fixed deposits of customers
c) Savings deposits
d) Recurring deposits

33. Which of the following is an income for a bank?
a) Depreciation on bank's property
b) Interest on inter bank borrowings
c) Profit on revaluation of investments
d) Provisions made on account of write-offs

34. Saving Bank Account can be opened in the name of ?
a) State text book printing corporations
b) District level housing cooperative societies
c) Communist Party of India
d) Aravind Samuel, Anurag Deepak and Amarish Sugandhi Jointly

35. The interest on recurring deposit is paid on the basis of ?
a) Simple interest calculated monthly basis
b) Simple interest on monthly products basis
c) Quarterly compounding
d) Interest calculated on daily products basis

36. Which of the following statements is true?
i. Term deposits are non-transaction deposits
ii. Cheques can be issued on short-term deposits
iii. All term deposits are interest bearing deposits
a) (i) only
b) (ii) only
c) (iii) only
d) (i) and (iii)

37. The credit policy laid down by the top management of a bank does not deal with?
a) Credit risk management
b) Pricing of the credit products
c) Appraisal of time and demand deposits
d) Documentation standards.

38. Which of the following factors is not required to be considered to analyze the repayment capacity of a borrower?
a) Working capital management
b) Personal educational qualifications
c) Financial leverage
d) Interest rate risk management

39. Which of the following is a facilitating service of core loan products of retail banking services?
a) Current or savings accounts
b) Legal services for documentation
c) Delivery of loan at promised time period
d) Flexibility in prepayment of loan

40. Which of the following is an most important advantage of retail banking on the resource side?
a) Consumer loans are low risk products
b) Innovative product development and disbursal
c) Increases the subsidiary business of a bank
d) Requires less efforts to market retail loan products

41. Lenders may not provide trade-offs to the borrowers on the basic term of consumer installment credit relating to?
a) Interest rate
b) Maturity of the loan
c) Maturity of the deposit
d) Quantum of finance

42. Which of the following is the risk associated with the retail banking?
a) Strong recovery strategy
b) Definite lending limits
c) Effective credit process and proposals
d) Inadequate risk pricing

43 The advantage of consortium finance is?
i. Speedy transactions and individual approach
ii. Involvement of huge amounts
iii. Use of expertise of all the banks
a) (i) only
b) (ii) only
c) (iii) only
d) (i), (ii) and (iii)

44 Which of the following is not a function of the agent bank in loan syndication?
a) Ensuring the compliance of conditions precedent under the loan agreement
b) Determining the LIBOR interest rate for each interest rate
c) Planning for future syndication of loans
d) Receiving notices relating to cancellation of any part of the loan

45. Which of the following is not a phase/step in the formation of loan syndication?
a) Finalization of supply agreement
b) Identify the needs of the borrower
c) Preparation of information memorandum
d) Invite other banks to participate

46. Which of the following statements is true?
a) SSI is an undertaking in which the investments in fixed assets in plant and machinery does not exceed one million
b) Small and medium enterprises both in size and shape are not homogenous in nature
c) The small and medium enterprises contribution towards the GDP is nominal
d) Small and medium enterprises do not support the large industries.

47. The Nayak Committee has suggested the turnover method for assessing the working capital and pegged it at?
a) 15% of the projected annual turnover, as working capital limit
b) 20% of the projected annual turnover, as working capital limit
c) 25% of the projected annual turnover, as working capital limit
d) 30% of the projected annual turnover, as working capital limit

48. Which of the following is not a part of the rehabilitation package granted for revival of sick industry?
a) Waiver of penal interests
b) Funding by sanctioning of term loans towards the unpaid installments of loans
c) Grant of additional working capital loans
d) Not demanding the promoters contribution towards the rehabilitation package

49. Service Area Approach is associated with?
a) Industrial finance
b) Microfinance
c) Rural finance
d) Consortium finance

50. Which of the following resources cannot be securitized?
a) Credit balances outstanding in cash credit accounts
b) Credit Card receivables
c) Hire purchase receivable
d) Mortgage in lieu of future payments

51. Which of the following is a type of anticipatory letter of credit?
a) Green clause letter of credit
b) Yellow clause letter of credit
c) Back to back letters of credit
d) Revolving letter of credit

52. Performance guarantee is issued?
a) In lieu of earnest money
b) In lieu of retention money
c) In lieu of indemnity bonds
d) For successful competition of Turnkey projects

53. Which of the following is not a transfer of funds by using the electronic media?
a) Mail transfer of funds
b) Telegraphic transfer of funds
c) Electronic credit transfers
d) Electronic clearing transfers

54. Which of the following is not an augmenting feature of credit cards?
a) Personal accident insurance
b) Cash withdrawal facility
c) Add-On facility
d) Automatic recovery of interest on term loans

55 Which of the following is a disadvantage of going public issue?
a) Provides liquidity to existing shares
b) Commands better pricing than placement with few investors
c) Increased regulatory norms
d) Enables valuation of the company

56 Which of the following is not a reason for regulating the banking operations?
a) Banks hold a major portion of the public savings
b) Banks intermediate between the savings and investments
c) Banks hold a large part of the money supply
d) Banks earn profit from non-fund services

57. Which of the following statements is true?
a) Resave Bank of India empowers the banks to open branches according to their will and pleasure
b) Reserve Bank of India is a central bank which monitors only lending activities pertaining to export credit
c) Banks have authority to establish the ATMs at their convenience
d) Rural banks of commercial banks do not have freedom to issue credit cards

58. When the customer withdraws cash from ATM, the banker and customer relation ship is?
a) Debtor and Creditor
b) Creditor and Debtor
c) Lessor and Lessee
d) Agent and principal

59. Which of the following is a public sector Bank?
a) IDBI
b) ICICI
c) AXIS
d) HDFC

60. Trade control in India is regulated by?
a) RBI
b) SEBI
c) EXIM Bank
d) DGFT

61 Which of the following businesses is prohibited as per Sec 8 of B.R Act 1949?
a) Executing the trusts
b) Leasing
c) Retail trading
d) Underwriting

62. Which of the following is not one of the essential elements of internal audit?
a) Totality
b) Expertise
c) Independence
d) Subjectivity

63. The letter of credit, which facilitates the exporter to get pre- shipment finance (from the stage of purchase of raw material until the warehousing of the finished goods) from advising bank is called?
a) Red Clause LC
b) Lines of credit
c) Packing credit loan
d) Green Clause LC

64. A term loan is classified as a non-performing asset, if interest or installment is overdue for period exceeding how many days?
a) 90
b) 91
c) 180
d) 182

65. Which of the following is an interest bearing demand deposit?
a) Time Deposit
b) Re-investment deposits
c) Cash Certificates
d) Savings Bank account

66. Debt Recovery Tribunals accept petitions from Banks and financial institutions, only when the amount of suit is for Rs?
a) 1 00 000 and above
b) 5 00 000 and above
c) 7 50 000 and above
d) 10 00 000 and above

67. An endorsement is deemed as an instruction to?
a) Collecting Bank
b) Paying Bank
c) Drawer
d) Payee

68. Ideal Credit deposit ratio for a bank is?
a) 60%
b) 40%
c) 90%
d) 30%

69. The rate at which RBI rediscounts the bills of commercial banks is called as?
a) Bank Rate
b) Prime Lending rate
c) Repo rate
d) BPLR

70. Which of the following is not one of the RBI directives on clean note policy?
a) Currency note packets are not to be stapled and secured with paper bands
b) Soiled notes are to be stapled before they are remitted to Currency Chest.
c) Water mark window of bank notes shall not contain any writings
d) Currency notes are to be sorted in to Issuable and non-issuable notes.

71. Which of the following committees are related to 'Micro financing'?
a) Nayak Committee
b) Tandon committee
c) Vyas Committee
d) Narasimham committee

72. The relation ship between RBI and the Bank maintaining the currency chest is that of?
a) Debtor and Creditor
b) Principal and Agent
c) Bailor and Bailee
d) Creditor and Debtor

73. Normally, the number of members in a self Help Group shall not exceed?
a) 10
b) 20
c) 50
d) 15

74. Short fall in fulfilling the targets of Priority sector and agricultural finance by domestic commercial banks shall be deposited with/in?
a) RIDF
b) SIDBI
c) RBI
d) IDBI

75. The maturity value of a Recurring deposit with a monthly contribution of Rs 500 kept for a period of 12 months, at 9% interest rate compounded quarterly would be Rs.?
a) 6, 265
b) 6, 625
c) 7, 255
d) 7, 555

76. Which of the following is not an imperfect note?
a) Washed note
b) Bleached note
c) Mutilated note
d) Oiled note

77. Credit rating helps in measuring the credit risk and facilitates?
a) Considering higher credit limits
b) Making loan provisioning at an early stage
c) Accurately calculate the probable loan losses
d) Pricing of a loan

78. The Reverse Repo has the following characteristic?
a) Borrowing by RBI from banks
b) Borrowing with government security as collateral
c) Short term borrowing
d) All of these

79. Under the Nayak Committee recommendations, the quantum of working capital limits from the bank is minimum percentage of the projected annual sales?
a) 5%
b) 15%
c) 20%
d) 25%

80. Banks insist on providing finance for those projects or activities only which they consider to be viable. What is meant by viability of project?
a) Capacity to generate cash, adequate to service debt and surplus for borrower's personal requirement.
b) Generation of cash to meet debt liability
c) Generation of profits.
d) Generation of gross profits

81. Letter of negative lien obtained from borrower by a bank contains?
a) An undertaking that the property mortgaged to the bank is his own
b) A confirmation that the borrower had earlier deposited title deeds to create mortgage on the property.
c) An undertaking not to create any encumbrance/lien on the property which he owns but not yet mortgaged to the bank
d) A declaration that he is the joint owner of the property furnishing the details of his share and valuation thereof.

82. Which of the following statement is CORRECT?
a) Consortium advances to be treated as NPA on the basis of recovery by individual banks
b) If one facility of a borrower is treated as NPA other facilities to him also to be treated as NPA even if there are no irregularities in that account.
c) Consortium must be formed if the total exposure of fund based limit exceeds Rs 100 crore.
d) Both (a) and (b)

83. If an IPO is under-priced, which of the following can be considered as consequences/implications of the same?
I. The company looses the opportunity to raise more funds
II. Under pricing would give less returns to the investor
III. Under pricing results in lower net worth on an increased equity.
a) Only (II) above
b) Only (III) above
c) Both (I) and (III) above
d) Both (II) and (III) above all.

84. Corporate Bank files suit for recovery of its loan against the guarantor only and not the borrower. Guarantor pleads in the court that before filing suit against him, money should be recovered from the borrower. In such circumstances, the bank can seek recourse in the court against?
a) All the liable parties together only
b) Any one of them at a time
c) All separately
d) At its discretion it can proceed against any one

85. A letter of credit (LC) wherein the credit available to the customer gets reinstated after the bill is paid is known as?
a) Back to back LC
b) Red clause LC
c) Back to front LC
d) Revolving LC

86. Regional Rural Banks are?
a) Private Sector scheduled commercial banks
b) Cooperative banks
c) Foreign banks
d) Public sector scheduled commercial banks

87. Large corporate customers demand?
a) Short term products from their banks irrespective of the cost at their times of need.
b) Increasingly sophisticated products from their banks at the lowest possible cost.
c) Disintegrated financial products from their banks at the lowest possible cost.
d) Basic banking products from their banks but with speed and efficiency.

88. Funded Services under corporate banking does not include?
a) Working Capital Finance
b) Bill Discounting
c) Export Credit
d) Letters of Credit

89. Which of the following is not directly involved in rural lending?
a) Cooperatives
b) RRBs
c) Commercial banks
d) SIDBI

90. PACSs provide?
a) Mainly long term credit
b) Mainly short term credit
c) Both long term and short term credit
d) Do not provide any credit

91. The purpose of which is to make credit of available to essential sectors of the economy according to national priorities?
a) Selective Credit Control (SCC)
b) Maintenance of cash reserve
c) Reserve fund
d) Comprehensive Credit Control

92. The system of note issue followed by the RBI is?
a) Proportional reserve system
b) Minimum reserve system
c) Minimum fiduciary system
d) Maximum fiduciary system

93. The rate at which the Reserve Bank of India lends to the commercial banks in very short term against the backing of the Government securities is known as?
a) Bank rate
b) Repo rate
c) Reverse Repo
d) Discount rate

94. Scheduled banks are those?
a) Includued in the 2nd schedule of the Banking Regulation Act-1949
b) Includued in the 2nd schedule of the Companies Act-1956
c) Includued in the 2nd schedule of the Reserve Bank of India Act -1934
d) Bank Nationalization Act -1969

95. The following is classified as a public sector bank?
a) ICICI Bank
b) IDBI Bank Ltd
c) Axis Bank
d) Local area bank

96. The banker-customer relationship in credit card payment is?
a) Creditor-debtor
b) Debtor-creditor
c) Agent principal
d) Principal-agent

97. The base rate is set by?
a) Individual banks
b) RBI
c) Government of India
d)RBI in consultation with Government

98. State Bank of India's new floating rate of deposit is directly linked to?
a) Inflation Rate
b) BPLR
c) Base Rate
d) BankRate

99. Six private sector banks were nationalised on April 15, 1980, whose reserves were more than?
a) 100 Crores
b) Rs. 200 crores
c) 300 crores
d) 400 crores

100. Security printing press was established in 1982 at?
a) Kolkata
b) New Delhi
c) Bombay
d) Hyderabad

Answers

1) d      2) c  3) d     4) d        5) d   6) c    7) b   8) d    9) a  10) c
11) c 12) b 13) d 14) c 15) d 16) d 17) a 18) b 19) a 20) c
21) d 22) c 23) d 24) a 25) c 26) a 27) d 28) c 29) b 30) d
31) d 32) a 33) c 34) d 35) c 36) d 37) c 38) b 39) a 40) c
41) c 42) d 43) d 44) c 45) a 46) b 47) b 48) d 49) c 50) a
51) a 52) d 53) a 54) d 55) c 56) d 57) c 58) a 59) a 60) d
61) c 62) d 63) d 64) a 65) d 66) d 67) b 68) a 69) a 70) b
71) c 72) b 73) b 74) a 75) a 76) c 77) d 78) d 79) c 80) a
81) c 82) a 83) c 84) d 85) d 86) d 87) b 88) d 89) d 90) b
91) a 92) b 93) b 94) c 95) b 96) b 97) a 98) c 99) b 100) d