This set of sample paper multiple-choice questions is designed to help students understand key concepts in financial markets, including stock exchanges, investment instruments, regulatory bodies, and trading mechanisms.
Financial Markets Class 10 Sample Paper MCQ
1. Which of the following is an example of Physical Asset?
a. Real Estate
b. Fixed Deposit
c. Provident Fund
d. Shares
Explanation: A physical asset can be touch and see for example land or buildings.
2. What is the other name of Preferential issues?
a. Public Issue
b. Rights issue
c. Private Placement
d. Bank Issue
Explanation: Share are given to few selected people, it is not for general public.
3. Name a customized contract between two entities, where settlement takes place on a specific date in the future at today’s pre-agreed price.
a.Forward contract
b.Future contract
c. Calls
d. Options
Explanation: It means that the two people agree on a price for something they will exchange in the future.
4. “NSE introduced a nationwide, online, and fully automated SBTS where a member can punch into the computer the quantities of a security and the price at which he would like to transact, and the transaction is executed as soon as a matching sale or buy order from a counter party is found.”
Write the full form of SBTS?
Explanation: SBTS is a computer system that helps to buy and sell orders instantly.
5. Where an investor can lodge complaint against brokers on certain trade disputes or non-receipt of payment/securities?
a. The Investor Grievances Cell (IGC)
b. The Investment Grievances Cell (IGC)
c. The Investor Grievances Centre (IGC)
d. The Investor Grief Call (IGC)
Explanation: If any person having any problem with broker then you can give the complain to the Investor Grievances Cell.
6. Give any one similarity between Bank and Depository.
Holds funds in an account, Transfers funds between accounts on the, instruction of the account holder, Facilitates transfers without having to, handle money, Facilitates safekeeping of money.
DEPOSITORY
Hold securities in an account, Transfers securities, between accounts on, the instruction of the account holder, Facilitates transfers of ownership without, having to handle securities, Facilitates safekeeping of shares.
Explanation: Banks holds your money and depositories holds your shares.
7. Which amongst the following is NOT a Credit rating agencies in India
a. CRISIL
b. Public Sector
c. ICRA
d. Fitch
Explanation: CRISIL, ICRA and Fitch rate companies only “Public Sector” is just a category.
8. “ Ram opened a fixed deposit account with a bank.” What is the other name of fixed deposit account with banks?
Show Answer ⟶Explanation: Term deposit mean you lock your money in the bank for fixed time.
9. “The regulator ensures that the market participants behave in a desired manner so that securities market continues to be a major source of finance for corporate and government and the interest of investors are protected.
“ Name any one Regulator of the Securities .
Explanation: SEBI make sure that everyone plays fair in the stock market.
10. Fixed Assets and Investments are examples of
a.Sources of Funds
b.Application of Funds
c.Loan Funds
d.Shareholder’s Funds
Explanation: Application of Funds means when your money is used for buying property or shares.
11. When a security is sold above its face value, it is said to be issued at a
a. Discount
b. Premium
c. Par Value
d. Maturity
Explanation: Selling for more than its original value.
12. Which amongst the following institutions can NOT be a DP?
a. Banks
b. Financial Institutions
c. SEBI registered trading members
d. CARE
Explanation: CARE is a rating agency not a depository.
13. Full form of ADR is __
a. American Depositary Receiving
b. American Depositary Receipt
c. American Depositary Reform
d. American Depositary Range
14. Name any two commodities which can be considered as underlying asset in the Commodity Derivatives Market.
Show Answer ⟶Explantion: Gold and Crude Oil is a commonly traded commodities.
15. Define ‘Maturity Date’?
Show Answer ⟶16. What does Debt-Equity Ratio reflects?
a. relative contributions of debtors and owners to finance the business.
b. relative contributions of creditors and owners to finance the business.
c. relative contributions of promoters and owners to finance the business.
d. relative contributions of producers and owners to finance the business.
Explanation: It shows that how much money comes from loans or from owners.
17. Name the barometer of the Indian markets.
a. NEAT
b. SBTS
c. ICRA
d. Nifty
Explanation: Nifty helps to understand how the stock market is performing.
18. Mr. Vijay is a broker. His registration number begins with the letters
a. IND
b. INT
c. INS
d. INB
19. Calculate the maximum brokerage that can be charged by a broker from one of his clients, Mr. Jai as commission when Mr. Jai purchases 50 shares of ABC ltd @ ₹ 10.
a. ₹ 13.50
b. ₹ 12.50
c. ₹ 11.50
d. ₹ 10.50
20. As per accounting convention, all fixed assets except land have a fixed life. It is assumed that every year the worth of an asset falls due to usage.
Name the term used in accounting convention.
a. Appreciation
b. Gross Profit
c. Maturity
d. Depreciation
Explanation: Depreciation is the accounting method used to allocated the cost of a tangible fixed asset over its useful life.
21. Write the full form of NEAT .
Show Answer ⟶22. How does Mutual Fund help the investor by spreading risk ?
Show Answer ⟶23. Choose the odd one out:
a. Public Provident Fund
b. Post Office Savings ( for 6 years)
c. Company Fixed Deposits of 5 years
d. Liquid Funds
Explanation: Liquid Funds are short term plan.
24. Choose the correct statement
a. “The securities market has two interdependent segments: the primary (new issues) market and the Tertiary market.”
b. “The securities market has two interdependent segments: the Derivatives market and the Tertiary market.”
c. “The securities market has two interdependent segments: the primary (new issues) market and the secondary market.”
d. “The securities market has two interdependent segments: the primary (new issues) market and the Dealer .”
25. Which factor does not determine the interest rates?
a. Level of Government borrowings
b. Supply of money
c. Inflation rate
d. Financial Literacy
Explanation: Financial Literacy helps to understand the interest rates depend on economic factors.
26. Name the Mutual Fund unit which determined at the end of each trading session?
a. Net Asset Value
b. Net Asset Valuation
c. Netting of the Asset Valuation
d. Net Asset Value
Explantion: The Net Asset Value helps to understand one unit of a mutual fund at day’s end.
27. Which Derivative products initially emerged against fluctuations in commodity prices?
a. Hedging
b. Speculation
c. Arbitrage
d. Jobbing
Explanation: Hedging helps to protect against price changes in commodities.
29. Which of the following product is not tradable in Indian securities market as per SC(R) A956?
a. Shares
b. bonds
c. debentures
d. crypto currency
Explanation: The crypto currency is not a official tradable under this law.
30. Who does not regulate the securities market?
a. Department of Economic Affairs
b. Department of Company Affairs
c. Department of Commercial Affairs
d. Securities and Exchange Board of India
Explanation: In India the SEBI, Department of Economic Affairs and Department of Company Affairs, regulate securities market in india
31. What does issue on Premium mean in the Primary Market?
a. On Face Value
b. Below the face value
c. Above the face value
d. Without face value
Explanation: Face value is a original price given to the share or bond when it is first issued. If the face value of share is Rs. 10 and it is sold for Rs 15, it means that above face value.
32. Name the issue of shares or of convertible securities by listed companies to a select group of persons under Section 81 of the Companies Act, 1956.
a. Rights Issue
b. A Preferential issue
c. Initial Public Offering
d. A follow on public offering
Explanation: A right issue means that when the company offers extra shares to its existing shareholders, usually at a discounted price.
33. What is Cut-Off Price?
a. This issue price is called “Cut-Off Price”
b. This below issue price is called “Cut-Off Price”
c. This above issue price is called “Cut-Off Price”
d. This negligible issue price is called “Cut-Off Price”
Explanation: The Cut-Off Price is the final price at which shares are issued to investors during an IPO.
34. A shorter version of the Prospectus and contains all the salient features of a Prospectus. It accompanies the application form of public issues.
a. Red–Herring Prospectus
b. Abridged Prospectus
c. Red Prospectus
d. New Version of Prospectus
Explanation: An abridged prospectus is a shortened version of a full prospectus. It contains all the essential details about a public issue of shares or securites.
35. Book Building through the NSE system offers several advantages except this.
a. The NSE system offers a nationwide bidding facility in securities
b. It provide a fair, efficient & transparent method for collecting bids using the latest electronic trading systems
c. Costs involved in the issue are far less than those in a normal IP.
d. There is guaranteed allotment if we put bid through NSE platform.
‘
36. Draft Offer document’ means the offer document in the following stage.
a. Secondary stage
b. Existed stage
c. Relevant stage
d. Draft stage
37. What is meant by Secondary market?
a. Market for newly issue securities
b. Market for existed securities
c. Market for unlisted securities
d. Market of delisted securities
38. NSE is the first exchange in the world to use satellite communication technology for trading. Name Its trading system.
a. SBTS (Screen based trading system )
b. NEAT (National Exchange for automated Trading )
c. BOLT (BSE Online Trading )
d. ODIN (Open Dealer Integrated Network)
39. What is a confirmation bill of trades done on a particular day on behalf of the client by a trading member?
a. Purchase / Sale Note
b. Contract Note
c. Market price Bill
d. Cash memo
40. Which of the following is not a type of shares?
a. Right issue
b. Bonus
c. Bonds
d. Preference shares
41. Which of the following is not a type of bonds?
a. Zero Coupon bonds
b. Treasury Bills
c. Convertible bonds
d. Preference Shares
42. How do you define the Companies whose potential for growth in sales and earnings are excellent, are growing faster than other companies in the market.
a. Value Stocks
b. Growth Stocks
c. Manipulated Stocks
d. Undervalue stocks
43. Which derivative product the buyer having a right but obligation to buy the underlying?
a. Call option
b. Put option
c. Future
d. Forward
44. Name the margin payable upfront in option contract.
a. Initial margin
b. MTM
c. Option Premium
d. Optional Margin
45. Which contract is customized and tradable in two known parties?
a. Future
b. Forward
c. Option
d. Optional
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