SMART DISHA ACADEMY (Chandkheda, Ahmedabad)

Capital market and Derivative market (dealers) module Test- 2019

NAME: ___________________________________________ Date:

Q1. The steps taken by NSCCL on account of settlement fund shortage include.

a) Trading may not be permitted c) Both of the above

b) Securities payout with held d) None of the above

Q2. In case the net outstanding position in any security is nil, the difference between the buy and sell values is considered as
national loss for the purpose of calculating the………….

a) Volatility margin b) Initial margin c) Buy margin d) Mark to market margin

Q3. What is FALSE about an outstanding order on the NEAT system?

a) It is an order that has been entered by the user and is partially matched
b) It is a stop loss order that has not yet been triggered in the market
c) It is an order that has been entered by users and not yet been traded
d) It is an order that has been entered by users, but which has not been completely traded or cancelled

Q4. Stop loss, Disclosed quantity order and market orders are not possible in block trades.

a) True b) False

Q5. If the current ratio is 2: 1 and current liabilities are Rs.40000; current assets would be:

a) 80000 b) 40000 c) 20000 d) 120000

Q6. Two buy orders enter into the system and are unmatched: 1) 200 shares @ Rs.72.75 at time 10:30 a.m. 2)
300 shares @ Rs.72.80 at time 10:30 a.m. Which order will get a priority for getting executed?

a) Order no.1 b) Order no.2 c) Both statement are true

Q7. . Statement 1: An active buy order matches with the best passive sell order if the price of the passive sell order is less
than or equal to the price of the active buy order.

Statement 2: An passive buy order matches with the best sell active sell order if the price of the passive buy order is
less than or equal to the price of the active sell order.

Which of the above statement is true?

a) Statement 1 b) Statement 2 c) Both statement are true d) Both statement are false

Q8. Who settles the trades executed at NSE?

a) NSDL b) Clearing members c) SEBI d) NSCCL

Q9. What price does a market order take, in case the security has never been traded on the NEAT system?

a) The market order gets cancelled by the system

b) Market orders cannot be entered for a security in which a trades has not taken place
c) The market order takes the value of the base price and sits in the order book as a passive order
d) None of the above

Q10. . Buyback orders are identifies in the MBP screen by an………………..

 a) Asterisk (*) b) A star c) Hyphen d) None of the above

Q11. What is the code allotted as security type for unsecured debentures?

a) 05 b) 13 c) 01 d) 08

Q12. The effect of the provisions of SC (R) A, 1956 clearly is that if a transaction is securities has to be validly
entered into, such a transaction has to be either between the members of a recognized stock exchange or
through a member of a stock exchange? The above statement is True or False?

a) False b) True c) Partially True d) True only for debentures

Q13. Disclosed quantity allows the users the disclose…………

a) only a portion of the order quantity to the market c) All of the order quantity
b) 50% of the order quantity d) None of the above

Q14. In T+2 rolling settlement to NSE, custodial confirmation takes place on…………….

a) T+0 b) T+1 c) T+2 d)T+3

Q15.Mr. Desai has decided to Deposit Rs.200000 in the bank annually. If the bank has a policy of continuous
compounding and prevailing interest rate is 8% how much would his deposit grow up to in 2 years?

a) Rs.434141.15 b) Rs.413502.54 c) Rs.485123.70 d) Rs.433820.81

Q16. Which of the following statements is not correct?

a) Depository is registered owner of the securities held in demet form

b) Securities in a depository are fungible
c) Securities in a depository are held in dematerialized form
d) Dematerialized securities have distinct numbers

Q17. Auction is held in PQR for 10000 shares. The closing price of the PQR on that day was Rs.249. The last
traded price of PQR on that day was Rs.244. The close price of PQR last Friday was Rs.245. The previous day
close price of the PQR on that day was Rs.254. What is the maximum allowable price at which the member can
put a sell order in the auction for PQR? (Assume price band applicable for auction market id +/- 20%).

a) Rs.304.80 b) Rs.380.35 c) Rs.354 d) Rs.344

Q18. The first two characters in the ISIN code for a security represents………..

a) Issuer Type b) Security type c) Country code d) Company identity

Q19. If limit price is not specified then………price is taken as the limit price for the order.

a) Trigger price b) Market price c) Lat traded price d) Previous day closing price

Q20. The authorized person is not allowed to have any trading relationship with the clients they introduced.

a) True b) False

Q21. The copy of advertisement should be retained for a period of

a) 1 year b) 3 years c) 5 years d) forever

Q22. The balance sheet information pertaining bto

 a) Firms assets and liabilities b) Shareholders equity c) All of the above

Q23. Market capitalization ratio is used as measure of stock market size

a) True b) False

Q24. Securities points are charged to member for………….

a) only for gross exposure & turnover violations

b) Only for violation in respect in respect of client code notifications
c) Only for violation in respect of non-confirmation of custodial trades
d) All of the above

Q25. Penalty points are charged to members for………….

a) only for gross exposure & turnover violations

b) Only for violation in respect in respect of client code notifications
c) Only for violation in respect of non-confirmation of custodial trades
d) All of the above

Q26. Sis it not compulsory for a trading member to maintain a separate bank account for the clients?

a) True, unless his client request for opening a bank account

b) True
c) True, only if his client are not his relatives
d) False

Q27. In case the security has not been traded on a particular day, ………… at the NSE is to be considered as the
closing price?

a) The average closing price for the last one week

b) The theoretical closing price
c) The latest available closing price
d) None of the above

Q28. Under companies Act, 1956, an issue is referred as public if it results in allotment of securities to……….

a) 50 or more investors b) 15 investors c) 25 investors

Q29. The capital market system has four type of market………..

a) Normal market, odd lot market, RETDEBT market, and auction market
b) Limit order market, odd lot market, RETDEBT market, and auction market
c) Normal market, odd lot market, whole sale debt market, and auction market
d) RETDEBT market, Bulk trade market, Normal market, and auction market

Q30. Find the value of Rs.50000 deposited for a period of 3 years at the end of the period when the interest is
10% and continuous compounding is done.

a) Rs.67493.00 b) Rs.57493.00 c) Rs.767493.00

Q31. Delivery of shred in street name and market delivery is treated as Bad delivery.

a) True b) False

Q32. Fixed assets turnover ratio is

 a) Net sales/ Avg net fixed assets
b) Used to measure the efficiency with which fixed assets are employed
c) Both of the above

Q33. In case of a 20% movement of the nifty index before 1 P.M., trading shall be halted for

a) 1 hr. b) 2 hr. c) Remainder of the day d) trading will continue

Q34. A trading member may face disciplinary proceeding for not complying with the……………

a) Code of advertisement b) Code of payment c) Code of disciplinary rules d) 1 and 2

Q35. In de mutualized exchange,

a) Ownership, trading, management are in the hands of three different sets of people
b) Ownership, trading, management are in the hands of same sets of people
c) Ownership, trading, management are in the hands of SEBI
d) None of the above

Q36. Person who can set user order value limit is termed as

a) User b) Dealer c) Branch manager

Q37. What does ‘S’ indicates as status in the ‘Auction Inquiry’ screen in the NEAT system?

a) Auction is in solicitor period c) Auction is deleted

b) System is matching the orders d) Auction is pending and yet to begin

Q38. What is the lot size in RDM segment?

a) 1 b) 10 c) 100 d) 2

Q39. Mr. Desai has decided to Deposit Rs.100000 in the bank annually. If the bank has a policy of continuous
compounding and prevailing interest rate is 11.5% how much would his deposit grow up to in 2 years?

a) Rs.166141.11 b) Rs.171507.54 c) Rs.185570.70 d) Rs.224871.26

Q40. Dominant promoter/ shareholders group (DGP) is a group of shareholders of the trading member,
corporate who normally would be individuals, not exceeding ………. in number.

a) 4 b) 3 c) 2 d) 1

Q41. ………….. are orders for which price is specified as ‘MKT’ at the time the order is entered

a) Day order b) IOC c) Market order d) Stop loss order

Q42. Security sigma means the …………….. of the security computed as at the end of the previous trading day.

a) Mean b) Volatility c) Impact cost d) None of the above

Q43. Financial leverage ratio is defined as……….

a) Debt/ Equity b) Equity/ Debt c) Net profit/ Net sales d) None of the above

Q44. Benefits of trading membership of the NSE include access to a nationwide trading facility for equities.
Derivatives, debts, and hybrid instruments/ products. True or False?

a) False c) true only equity shares

 b) False d) True only for derivatives

Q45. Order book provided by the NEAT system is known as……………

a) Limit order book c) Cash order book

b) Stop loss order book d) Open electronic consolidated limit order book (OECLOB)

Q46. No lock-in-period for deposits is applicable in the case of trading member, who is

a) Snot SEBI registered c) SEBI registered and enabled but not trade at all
b) SEBI registered but not enabled d) All of the above

Q47. If the current ratio is 1: 1 and current liabilities are Rs.20000; current assets would be:

a) Rs.40000 b) Rs.10000 c) Rs.15000 d) Rs.20000

Q48. Who provides for electronic transfer of securities in the stock market?

a) RBI b) Depositories c) Clearing agencies d) SEBI

Q49. No payment for transaction in which a trading member is taking position as a principle will be allowable to
be make from clients approves the payment…….

a) True, unless his clients approves the payment

b) True
c) True, only if his clients are making payments on time
d) False

Q50. On which day and at what time, trade details are available for verification?

a) On T day, 19:00 hours IST c) On T day, 14:00 hours IST

b) On T+1 day, 19:00 hours IST d) None of the above

Q51. Is it compulsory for a trading member to maintain a separate bank account for the clients?

a) Yes b) No c) Yes, only if clients are not his relatives

Q52. What does ‘SPD’ indicates as message code in ‘full message window’ in the NEAT system?

a) Security suspension/ De-suspension

b) There is no such message code as ‘SPD’ in the full message window
c) All message related to suspension for trading of listed securities only
d) All message related to securities only

Q53. All auction offers are entered into the……………..?

a) Auction accumulator book c) Auction trade book

b) Auction order matching system d) Auction order book

Q54. What is the present value of Rs.50000 receivable after 3 years at a discount rate of 10% under continuous
discounting?

a) Rs.37041.00 b) Rs.47041.00 c) Rs.45041.00

Q55. SEBI made it mandatory for all brokers to use ……………………… for all clients.

a) Permanent Account number c) Bank account number

 b) Driving license number d) Unique client code

Q56. Shortage in limited physical market are compulsory closed out at…………..

a) 20% over the last traded price c) 20% over the actual traded price
b) 10% over the last traded price d) 10% over the actual traded price

Q57. How many characters are there is ISIN?

a) 14 b) 12 c) 11 d) 10

Q58. A trading member shall be deemed guilty of misconduct if he fails to ……………….

a) Submit its audited accounts to the exchange

b) Pay its subscription fees, arbitration charges or any other money which may be due to the exchange
c) To submit or makes any false or misleading statement in its clearing forms
d) All of the above

Q59. ………… or an individual can become member of an exchange

a) A corporate, a partnership firms

b) Hindu undivided family
c) An individual, a partnership firms ,Hindu undivided family
d) An individual, ,Hindu undivided family

Q60. Rahul is supposed to receive Rs.90000 from Chandra after 3 years. If the interest rate is 8%, what is the
present value of the amount due from Chandra?

a) Rs.81444.90 b) Rs.71444.90 c) Rs.86444.90 d) Rs.91444.90

 ANSWERS

1. C 49. B
2. D 50. A
3. B 51. A
4. A 52. A
5. A 53. D
6. B 54. A
7. B 55. D
8. D 56. C
9. C 57. B
10. A 58. D
11. D 59. A
12. B 60. B
13. A
14. B
15. D
16. D
17. A
18. C
19. A
20. A
21. B
22. C
23. A
24. C
25. D
26. D
27. C
28. A
29. A
30. A
31. A
32. C
33. C
34. A
35. A
36. C
37. A
38. B
39. D
40. A
41. C
42. B
43. A
44. B
45. D
46. D
47. D
48. B