Securities Market and General Awareness MCQs for SEBI Grade A 2020 Exam Part - 2

Hello Aspirants,

 SEBI Grade A 2020 – exam is going to be conducted very soon. To prepare better and to the point, aspirants need to study relevant and valuable material. The below post gives the detailed questions answers for SEBI Grade A Securities Market and General Awareness. Read with full ATTENTION and SHARE IT. 

Securities Market Awareness for SEBI Grade  A/ RBI Grade B

                                                   For Part 1: Click Here

Q1. What does A stands for in NAV in Mutual Fund Industry?

A. Association

B. Asset

C. Accounting

D. Administrator

E. Amortization

Explanation: (B) NAV stands for Net Asset Value.

•    NAV is basically the current value of a mutual fund unit.

• Ex: Three Investors P, Q and R invests Rs. 10,000, Rs. 20,000, Rs. 30,000 respectively in a mutual fund.

• Each MF investor will be allotted units P 1000 units (Rs. 10,000/10), Q 2000 units (Rs. 20,000/10) R 3000 units (Rs. 30,000/10) (Rs. 10 is the face/par/nominal value)

• NAV Formula:  NAV = (Assets - Liabilities) / Total number of outstanding shares.

     Assets: Rs. 60,000   6000 units * 10 (Total no. of units * Face value) + Rs.2000 (dividend income)  + Rs. 10,000  (increase in the value of Mutual Fund units) = Rs. 72,000

•      Liabilities: Rs. 1000 (Brokerage Charged) + Rs. 1000 ( Operating Expenses) = Rs. 2000

•      Net Asset Value =  Rs. 72,000 – 2000/ 6000 =  Rs. 11.66

Q2. The maximum load that a fund can charge is determined by?

A. SEBI

B. Sales Agent

C. Distributors

D. AMC

E. RBI

Explanation: (A) Mutual Funds are regulated by SEBI.

• Mutual Funds may impose a charge on the investors at the time of entering or exiting from a fund called the entry or exit load respectively.

• Presently, entry loads are prohibited by SEBI.

• Load Calculation Formula: 

          It is calculated as a percentage of the NAV and reduced from the NAV to arrive at the price that the investor will get on exiting from the investment.

• If NAV on redemption of units is Rs. 11.66 (1% exit load)  (Above Question)

• An exit load linked to the period of holding of the investor.
• 
  

Q3. What does S Stand for in BCSBI?

A. Syndicated.

B. Swaps

C. Security

D. Sectors

E. Standards

Explanation: (E) BCSBI stands for The Banking Codes and Standards Board of India.

• Oversees: Code of Bank's Commitment to Customers.

•  Independent and autonomous body, registered as a separate society under the Societies Registration Act, 1860 on 18 February 2006.

• Headquarter: Mumbai

• Chairman:  A C Mahajan

Q4. National Institute of Bank Management is situated in?

A. Lucknow

B. Mumbai

C. Pune

D. Chennai

E. Hyderabad

Explanation: (C) NIBM was established in 1969 by the Reserve Bank of India.

• Chairman : Governor of RBI

• Publications: Quarterly Journals

                          Prajnan

                          Vinimaya

Q5. What does M Stand for in FEMA?

A. Monetary

B. Market

C. Maturity

D. Multilateral

E. Management

Explanation: (E) FEMA stands for Foreign Exchange Management Act.

• FEMA paved the way for Prevention of Money Laundering  Act, 2002

• Purpose: Facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.

• FEMA Act, 1999 replaced FERA Act, 1973

• FERA stands for in Foreign Exchange Regulation Act.

Stay tuned with Exam Together. Subscribe this blog for upcoming posts notifications. We will be coming up with more such posts. We hope you like reading all these questions. Best of Luck for your preparation.

Share it with your friends!