vu mgt411 Final Term - Quiz No.5
vu mgt411 Money & Banking Quiz
This quiz belongs to book/course code vu mgt411 Money & Banking of vu organization. We have 9 quizzes available related to the book/course Money & Banking. This quiz has a total of 10 multiple choice questions (MCQs) to prepare and belongs to topic Final Term. NVAEducation wants its users to help them learn in an easy way. For that purpose, you are free to prepare online MCQs and quizzes.
NVAEducation also facilitates users to contribute in online competitions with other students to make a challenging situation to learn in a creative way. You can create one to one, and group competition on an topic of a book/course code. Also on NVAEducation you can get certifications by passing the online quiz test.
Question 1: Which of the following are used to monitor and stabilize the economy?
Stock exchanges
Commercial Banks
Central Banks
Financial institutions
Question 2: A zero coupon bond:
Does not pay any coupon payments because the issuer is in default
Pays coupons only once a year versus the usual twice a year
Promises a single future payment
Pays coupons only if the bond price is below face value
Question 3: Internal Rate of Return is __________.
Present value of investment
Future value of its investment +Cost of investment
Cost of investment
Present value of investment + cost of investment
Question 4: Which of the following represents the fisher's equation?
Nominal interest rate = real interest rate + inflation
Nominal interest rate + inflation = real interest rate
Nominal interest rate = real interest rate - inflation
Nominal interest rate = real interest rate / inflation
Question 5: Core principles of Money and Banking include each of the following except?
People act rationally
Time has value
Information is the basis for decisions
Risk requires compensation
Question 6: What is true relationship between return and risk?
Lower the risk greater the return
Greater the risk greater the return
Greater the risk the return will remain constant
No relationship between them
Question 7: If information in a financial market is asymmetric, this means:
Borrowers and lenders have perfect information
Borrowers would have more information than lenders
Borrowers and lenders have the same information
Lenders lack any information
Question 8: The Segmented Markets Theory of term structure suggests that:
Investors have strong preferences for bonds of a particular maturity
Investors have no preference for short-term bonds over long-term bonds, or vice versa
Interest rates on long-term bonds strongly influence the demand for short-term bonds
Bonds of different maturities are perfect substitutes for each other
Question 9: Securities are sometimes called as __________.
Secondary reserves
Primary reserve
Excessive reserve
Extra reserve
Question 10: Yield curves show which of the followings?
The relationship between bond interest rates (yields) and bond prices
The relationship between liquidity and bond interest rates (yields)
The relationship between risk and bond interest rates (yields)
The relationship between time to maturity and bond interest rates (yields)
