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Published on: 27/09/2019
Financial Markets
Download CBSE Class 12th Standard CBSE Business Studies question papers, sample papers, important questions, and previous year solved papers in PDF format. Get free study materials, NCERT solutions, and exam preparation resources for Class 12th Standard CBSE Business Studies
Questions + Answers key
Take MCQ Business Studies Test

1.
A Company does window dressing in its financial statement to attract investors and creditors. Is it correct in your opinion? Which values are affected here?
2.
A fast food manufacturing foreign company plans to open chain of cheap fast food centers near the schools in Delhi. According to you what will be the results of this plan?
3.
How does a stock exchange aid in pricing of securities?
4.
State briefly the names of the three interest gourps for productions of whose interest SEBI was established. Also write how it protects the interests of any one such group?
5.
Briefly differentiate between dematerialisation of securities and demultualisation of stock exchange?
6.
Excel Ltd proposes to raise capital from the public to the time of Rs.100 crores. It proposes to go public through the online system of the stock exchange. What is this method of raising capital called? State briefly the procedure for the same?
7.
Explain the following concepts with reference of a stock exchange:-
(a) Listing of security
(b) Badla
8.
Financial market are a boon to buyers & sellers as they reduce the cost of transaction. Explain how ?
9.
What is the other name given to zero coupen bond issued by RBI on behalf of Govt of India ? Why are they called zero coupen bond
10.
What are financial assets ? How do financial market provide liquidity to time?
11.
Briefly discuss price discovery mechanism in financial market
12.
How has SEBI played a developmental role in raising the standard of trending in ‘Indian Stock Market’?
13.
Distinguish between rights issue and private placement as methods of floating new issue.
14.
Name the benchmark of the BSE (Bombay stock Exchange). What does it indicate?
15.
“Stock Exchange spread the equity cult in the country”. Do you agree. Give reason.
1.
i) To cheat the investors/ lenders by providing them false information fraudulent activities
ii) Possibility of over capitalization
iii) Dissatisfaction amongst the employees
2.
i) Bad effect on the health of students
ii) Increase in the tendency of using fast food among students
iii) Profit to the foreign company
3.
In the financial market, the forces of demand and supply interact and fix the prices of securities. Investor, household represent supplier of funds and business forms the demand. Various market forces also interact and help in fixation of prices of securities.
4.
The three interest group are :- Issuers, investors and intermediaries. SEBI protects interest of intermediaries by offering a competitive, professional and expanding market with adequate and efficient infrastructure so that they are able to render better service to investors and issuers.
5.
Demutualization :- Refers to separation of ownership and control of stock exchange from trading rights of members. This reduces conflict of interest between exchange and brokers and reduces chances of brokers using stock exchanges for personal games.
Dematerlisation of Securities :- Refers to electronic book entry form of holding and transferring securities. There is no physical transfer and therefore problem of the theft, forgery, delay etc. are eliminated.
6.
The method to be adopted is called ‘E-IPO’ or electronic Intial Public offer under this method the company Excel Ltd has to enter into an agreement with the stock exchange. SEBI registered brokers have to be appointed for accepting applications and placing orders with the company. The company should also appoint a register to the issue having electronic connectivity with the exchange. The issuer company can apply for listing of its securities on any other exchange other than exchange through which it was offered its securities . A head manager may be appointed to co-ordinate the issue.
7.
a) Listing refers to inclusion of a company’s name on the official trading list of the stock exchange. Companies must fulfill requirements set to get their securities listed.
b) Badla :- When transaction in a stock exchange are carried over it is called badla. Transactions made in one accounting period are settled by payment for purchases and delivery of share certificate in the next settlement period.
8.
Financial markets reduce cost of transaction as they save time money and effort of both buyers and sellers by providing a common platform for them to meet and deal with each other.
9.
The other name given to Zero Coupon Bonds is ‘Treasury Bill’s. They are called zero coupon as they are issued at a price less than the face value but are repaid at par.
10.
Financial assets basically refer to assets which can be traded in the financial market like shares or debentures. Financial Markets provide Liquidity to such assets as they can be readily sold and converted into cash whenever require.
11.
Shares prices in a stock exchange are determined by prices of demand and supply. As demand for share of a particulars company increases the price also increases and vice versa. The role of intermediaries like brokers also influence movement of shares prices by their buying and selling.
12.
Private placement is when new issue is not offered to public bu to institutional investors and members of the public
13.
Rights issue refers to the right of existing shareholders of a company to e subscribe to new issue of shares in proportion to their holding
14.
The bench mark of BSE is the sensex, it indicates the price movement of shares There by the health of the economy as whole
15.
Yes, stock exchange spread equity cult in the country because will share of ownership of share of company’s possible. When share are offered in the stock exchange and subscribell by members of the public.
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