Tag: concepts and functions of financial markets

Questions Related to concepts and functions of financial markets

The intermediary between the customers and suppliers who perform financing and debt collection services is called a ________.

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Bank

  2. Factor

  3. Mutual fund

  4. NBFC

  5. Merchant Banker

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Correct Option: B
Explanation:

Factoring is a financial service under which the factor undertakes collection, accounting and management of the client's debt. Thus the factor is an intermediary between the supplier and the customers who performs financing and debt collection services.

An industrial company which has at the end of any financial year accumulated losses greater than its net worth is said to be _______________.

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Bankrupt

  2. Sick

  3. Weak

  4. Both (A) and (C) above

  5. None of the above

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Correct Option: B
Explanation:

Sick industrial company is company registered for not less than five years which has to the end of any financial year, accumulated losses equals to or exceeding its entire net worth.

Deregulation and globalization of the financial markets increase the volatility in ___________.

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Internal rates

  2. Exchange rates

  3. Prices of financial assets

  4. All of the above

  5. Both (A) and (B) above

Show answer
Correct Option: D
Explanation:

The most important and visible effect of globalization and integration of financial markets is the increase in volatility in:
1. Interest rates
2. Exchange rates &
3. Prices of financial assets change quite frequently in response to various changes taking place in different segments of the financial markets  all over the world.

The strategy of laying stress on domestic production which is usually adopted by developing countries is called as ________________.

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Open economy strategy

  2. Growth oriented strategy

  3. Inward oriented strategy

  4. Export substitution strategy

  5. None of the above

Show answer
Correct Option: C
Explanation:

The strategy adopted by the developing countries to strengthen the domestic industries by an providing lot of protection to domestic industry in the form of heavy tarrifs/ restrictions on imports is called the inward oriented strategy. Thus the main feature of the inward oriented strategy is to lay stress on domestic production.

Delhi is often described as a 'cosmopolitan' city. This means that it ____________

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. is the principal city

  2. is a city of great wealth

  3. is a city with a global reputation

  4. is a city with an ethnically diverse population

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Correct Option: D
Explanation:

A cosmopolitan city is a city that has a high diversity of population with the high number of population with a better life style than a village which suggests that it is a city of great wealth too.

Which of the following is example of consumer's co-operative society?

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Haryana handloom

  2. Gujarat co-operative milk marketing federation

  3. Apna bazar

  4. Urban Cooperative banks

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Correct Option: C
Explanation:

Apna bazar is an example of consumer's co-operative society. A consumer cooperative can be defined as a cooperative business owned by its customers for their mutual benefit. This type of cooperative business is service oriented rather than pecuniary profit.

Which strategy involves the substantial modification of existing products or the creation of new but related products that can be marketed to current customers through established channels?

business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

  1. Product Development

  2. Market Penetration

  3. Diversification

  4. Market Development

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Correct Option: A
Explanation:

Product development strategy involves the substantial modification of existing products or the creation of new but related products that can be marketed to current customers through established channels. It helps in the process of expansion of the existing business. Product development strategy can be defined as a process of bringing a new innovation to consumers from concept to testing through distribution.