1. Which of the following is true?
a) If a bank has oversold position, Bank will gain if the rate of foreign currency rises
b) If a bank has oversold position, Bank will gain if the rate of foreign currency declines
c) If a bank has oversold position, Bank will lose if the rate of foreign currency declines
d) If a bank has overbought position, Bank will gain if the rate of foreign currency declines
Answer - If a bank has oversold position, Bank will lose if the rate of foreign currency declines
2. NRE account cannot be opened in which of the following currencies?
a) Indian Rupees
b) USD
c) Euro
d) b and c
Answer - b and c
3. Value at Risk (VAR) concept can be described as
a) Downside risk potential
b) Measure of volatility
c) Measure of sensitivity
d) All of the above
Answer - Downside risk potential
4. RBI has put in place real time gross settlement system(RTGS) to mitigate the following risk
a) Market Risk
b) Settlement Risk
c) Operational Risk
d) Strategic Risk
Answer - Settlement Risk
5. Economic Equity Ratio is used to assess sustenance capacity of the bank. It is calculated using the formula
a) Net Interest Income / Shareholder Funds
b) Total Income / Shareholder Funds
c) Shareholder Funds / Total of Assets & Liabilities
d) Shareholder Funds / Total Assets
Answer - Shareholder Funds / Total Assets
6. If the fixed and variable cost at 50%production capacity is Rs.20000 and Rs.30000, respectively, the total cost at 70% capacity will be
a) 50000
b) 62000
c) 70000
d) 58000
Answer - 62000
7. Advance in the form of pledge should not be granted in respect of
a) Stock-in-process
b) Raw Material
c) Finished Goods
d) None of these
Answer - Stock-in-process
8. Inflation means
a) Increase in price
b) Decrease in value of money
c) Boom
d) a and b
Answer - a and b
9. Under Basel III, the risk weight for capital charge for credit risk on the basis of standardized approach for home loan of above Rs.75 lac, where loan to value (LTV) ratio is
a) 20%
b) 50%
c) 75%
d) 100%
Answer - 75%
10. No Frills' delivery of banking services at an affordable cost to the vast section of disadvantaged and low income groups is called
a) Vanilla Banking
b) Financial Inclusion
c) Financial Exclusion
d) Social Service
Answer - Financial Inclusion
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