Financial Markets & Institutions MCQs for UPSC Prelims

With reference to 'Financial Stability and Development Council', consider the following statements: 1. It is an organ of NITI Aayog. 2. It is headed by the Union Finance Minister. 3. It monitors macroprudential supervision of the economy. Which of the statements given above is/are correct?

1. A 1 and 2 only
2. B 3 only
3. C 2 and 3 only
4. D 1, 2 and 3

Consider the following statements : Statement I : As regards returns from an investment in a company, generally, bondholders are considered to be relatively at lower risk than stockholders. Statement II : Bondholders are lenders to a company whereas stockholders are its owners. Statement III : For repayment purpose, bondholders are prioritized over stockholders by a company. Which one of the following is correct in respect of the above statements?

1. A Both Statement II and Statement III are correct and both of them explain Statement I
2. B Both Statement I and Statement II are correct and Statement I explains Statement II
3. C Only one of the Statements II and III is correct and that explains Statement I
4. D Neither Statement II nor Statement III is correct

Consider the following: 1. Exchange-Traded Funds (ETF) 2. Motor vehicles 3. Currency swap Which of the above is/are considered financial instruments?

1. A 1 only
2. B 2 and 3 only
3. C 1, 2 and 3
4. D 1 and 3 only

With reference to Non-Fungible Tokens (NFTs), consider the following statements: 1. They enable the digital representation of physical assets. 2. They are unique cryptographic tokens that exist on a blockchain. 3. They can be traded or exchanged at equivalency and therefore can be used as a medium of commercial transactions. Which of the statements given above are correct?

1. A 1 and 2 only
2. B 2 and 3 only
3. C 1 and 3 only
4. D 1, 2 and 3

In India, under cyber insurance for individuals, which of the following benefits are generally covered, in addition to payment for the loss of funds and other benefits? 1. Cost of restoration of the computer system in case of malware disrupting access to one's computer 2. Cost of a new computer if some miscreant wilfully damages it, if proved so 3. Cost of hiring a specialized consultant to minimize the loss in case of cyber extortion 4. Cost of defence in the Court of Law if any third party files a suit Select the correct answer using the code given below:

1. A 1, 2 and 4 only
2. B 1, 3 and 4 only
3. C 2 and 3 only
4. D 1, 2, 3 and 4

With reference to the Indian economy, 'Collateral Borrowing and Lending Obligations' are the instruments of:

1. A Bond market
2. B Forex market
3. C Money market
4. D Stock market

Consider the following statements : I. India accounts for a very large portion of all equity option contracts traded globally thus exhibiting a great boom. II. India's stock market has grown rapidly in the recent past even overtaking Hong Kong's at some point of time. III. There is no regulatory body either to warn the small investors about the risks of options trading or to act on unregistered financial advisors in this regard. Which of the statements given above are correct?

1. A I and II only
2. B II and III only
3. C I and III only
4. D I, II and III

Consider the following statements: 1. In India, Non-Banking Financial Companies can access the Liquidity Adjustment Facility window of the Reserve Bank of India. 2. In India, Foreign Institutional Investors can hold the Government Securities (G-Secs). 3. In India, Stock Exchanges can offer separate trading platforms for debts. Which of the statements given above is/are correct?

1. A 1 and 2 only
2. B 3 only
3. C 1, 2 and 3
4. D 2 and 3 only