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4. Financial markets facilitate competition so that best price may be available to the investors.
This activity is known as:
a. Transfer price
b. Price discovery
c. Paralysis of analysis
d. Price movements
5. A ___________is one where dealers post bid rates (buy rates) and offer rates (ask rates)
which public investors can trade.
a. Dealers market
b. Auction market
c. OTC market
d. Primary market
6. Nifty is the stock market index for national stock exchange. S & P CNX nifty consist of.
a. 23 stocks
b. 30 stocks
c. 50 stocks
d. 100 stocks
8. When a country‟s imports are more than its exports, it leads to ________
a. Current account surplus
b. Current account deficit
c. Capital account surplus
d. Capital account deficit
10. The assumption “The market discounts everything” denotes that at any given point of time
security‟s price incorporates.
a. Economic factors, fundamentals and market psychology
b. Economic factors and company‟s risk
c. Company‟s risk and industry life cycle
d. Market psychology and volumes
11. Inverse head and shoulder is a chart pattern that gives a single of reversal of _________.
a. Downward trend
b. Upward tend
c. Previous trend
d. Resistance level and support level
12. The study of stock price during a public announcement and after a public announcement is
known as
a. Auto correlation test
b. Filter rule
c. Event study
d. Market research
16. If two securities have low correlation, the interactive risk will be
a. Large
b. Medium
c. Small
d. Zero
18. Sharpe‟s single index model is based on single factor assumption. This factor is
a. Covariance
b. Correlation coefficient
c. Standard deviation
d. Market index
19. The two notions of systematic and unsystematic risk were introduced in CAPM.
Unsystematic risk is:
a. Market risk
b. Interest rate risk
c. Unique / Firm‟s specific risk
d. Total risk
3. Exon Ltd, a pharmaceutical company plans to raise Ra. 10 crore through public issue of
equity shares. It‟s initial public offer is made through:
a. Secondary market
b. Primary market
c. Derivative market
d. Primary market & secondary market
5. In which approach does the stock pickers firstly pick the security , then investigate the
industry and finally analysis the current economic conditions?
a. Top-down
b. Bottom-up
c. Hot-pick
d. Stock-pick
6. Under GAAP norms, the companies are allowed to use discretion with regard to revenue
recognition and treatment of extraordinary income and expenses. This aspect is usually
exploited to:
a. Stabilize the stock price by manipulating the earnings
b. Create artificial scarcity of the stocks
c. Act upon insider information
d. Trigger the stock price by manipulating the earnings.
7. If the closing price is higher than the opening price, the candlestick chart is shaded with:
a. Red colour
b. Blue / Green colour
c. White colour
d. Black colour
8.Technical analsis develop „ buy and sell‟ signal based on: choose the odd answer.
a. Trends
b. Support and resistance level
c. Charts
d. Company rations
9. Head and shoulder is a _____________chart pattern that signals that the security is likely to
move against the previous trend.
a. Continuation
b. Reversal
c. Technical indicator
d. Sentiment indicator
10. Stock market investors shuns declining firm‟s security but welcome promising firm‟s
securities. It is known as
a. operational efficiency
b. Allocational efficiency
c. Informational efficiency
d. Random walk theory
11. If measure the tendency of its price to move up and down from its average
a. Standard deviation
b. Moving average
c. Covariance
d. Co-efficient of correlation
Section C 4 Mark Questions
1-d 2-b 3-b 4-b 5-a 6-c 7-a 8-a 9-a 10-a
11-a 12-c 13-b 14-a 15-d 16-c 17-b 18-d 19-c 20-c
1-b 2-c 3-a 4-d 5-b 6-a 7-b 8-d 9-b 10-b
11-a