Banking & General Financial Awareness
Banking & General Financial Awareness Multiple Choice Questions (MCQs) and Answers with explanation for All Banking Exams of 2020-2021 such as IBPS Bank PO, IBPS Bank Clerical, RRB PO and Clerical, SBI PO and SBI Clerical, IBPS Recruitments, RBI Grade B and RBI Banking Examinations.
1. What was the initial share capital of Reserve Bank of India?
[A] Rs. 5 Crore
[B] Rs. 10 Crore
[C] Rs. 15 Crore
[D] Rs. 20 Crore
Show Answer
Correct Answer: A [ Rs. 5 Crore ]
Notes:
RBI did not start as a Government owned bank but as a privately held bank without major government ownership. It started with a Share Capital of Rs. 5 Crore, divided into shares of Rs. 100 each fully paid up. In the beginning, this entire capital was owned by private shareholders. Out of this Rs. 5 Crore, the amount of Rs. 4,97,8000 was subscribed by the private shareholders while Rs. 2,20,000 was subscribed by central government.
2. First PCR was established in which of the following country?
[A] Japan
[B] Germany
[C] Australia
[D] Sweden
Show Answer
Correct Answer: B [Germany]
Notes:
The first Public Credit Registry in India was formed in Germany in 1934.A PCR is maintained by a public authority like the central bank or the banking supervisor. It helps in maintaining to keep records of individual and firms on unpaid debts and credit outstanding.
3. FEMA was introduced in which of the following year?
[A] 1990
[B] 1989
[C] 1999
[D] 1991
Show Answer
Correct Answer: C [1999]
Notes:
Foreign Exchange Management Act was enacted in 1999 and it had 25 original notifications. This act came into force w.e.f June 1, 2000.FEMA manages foreign exchange, i.e. forex.
4. What is full form of SIP in mutual funds?
[A] Seller Investment Plan
[B] Systematic Investment Plan
[C] System Involvement Plan
[D] None of the Above
Show Answer
Correct Answer: B [Systematic Investment Plan]
Notes:
A Systematic Investment Plan is an investment plan offered by mutual funds to investors to allow them to invest small amounts periodically instead of large sums at one time. The frequency of investment is usually weekly, monthly or quarterly.
5. What type of loan is a Housing loan?
[A] Unsecured Loan
[B] Secured Loan
[C] Corporate Loan
[D] Consumer Loan
Show Answer
Correct Answer: B [Secured Loan]
Notes:
Housing loan is a secured loan that is backed by an asset or equipment. The asset is called collateral. This collateral is needed because the amount of loan in the case of secured loan is much higher.
6. Which of the following are the different options available to the entrepreneurs for funding the business?
[A] Venture Capital
[B] Angel Financing
[C] Invoice Factoring
[D] All of the Above
Show Answer
Correct Answer: D [All of the Above]
Notes:
Most entrepreneurs look for funding via venture capital or angel financing. The another option available to the entrepreneurs is Invoice factoring to avail the finance needed.
7. What is the full form of QIB?
[A] Quotation for Indian Bidders
[B] Qualified Indian Bidders
[C] Qualified Institutional Bidders
[D] Quoted Indian Bidders
Show Answer
Correct Answer: C [Qualified Institutional Bidders]
Notes:
QIB refers to qualified institutional bidders ( Mutual Funds, banks, etc.).SEBI has instructed companies to allot to three major categories of allotees, namely, QIB, HNI and Retailers.
8. A Direct lease, a sale and leaseback, and a Leveraged lease are all examples of which of the following?
[A] Operating Leases
[B] Financial Leases
[C] Full-service Leases
[D] Off-Balance Sheet” methods of financing
Show Answer
Correct Answer: B [Financial Leases]
Notes:
Finance lease, also known as Full Payout Lease, is a type of lease wherein the lessor transfers substantially all the risks and rewards related to the asset to the lessee. A direct lease is a simple lease where the asset is either owned by the lessor or he acquires it.
9. Which one of the following is known as the father of Leasing Financing in India?
[A] C.R Pachauri
[B] Nandan Nilekani
[C] Farouk Irani
[D] A C Muthia.
Show Answer
Correct Answer: C [Farouk Irani]
Notes:
Leasing activity was initiated in India in 1973. The first leasing company of India, named First Leasing Company of India Ltd. was set up in that year by Farouk Irani, with industrialist A C Muthia. For several years, this company remained the only company in the country
10. Till when the RBI served as the central bank of Pakistan?
[A] August 1947
[B] January 1950
[C] June 1948
[D] November 1949
Show Answer
Correct Answer: C [June 1948]
Notes:
After the Partition of India in August 1947, the bank served as the central bank for Pakistan until June 1948 when the State Bank of Pakistan commenced operations.
