Practice Questions for AMFI Test

1. A close-ended mutual fund has a fixed : c. an upper limit on its NAV

a. NAV d. a fixed fund size
b. fund size
c. rate of return 8. An investor in a close-ended mutual fund
d. number of distributors can get his/her money back by selling his/her
units:
2. The maximum load that a fund can charge a. back to the fund
is determined by the : b. to a special trust at NAV
a. AMC c. on a stock exchange where the fund is
b. SEBI listed
c. AMFI d. to the agent through which he/she
d. distribution agents based on demand subscribed to the units of the fund
for the fund
9. The "load" charged to an investor in a
3. The amount required to buy 100 units of a mutual fund is
scheme having an entry load of 1.5% and NAV a. entry fee
of Rs.20 is : b. cost of the paper on which the unit
a. Rs.2000 certificates are printed
b. Rs.2015 c. the fee the agent charges to the
c. Rs.1985 investor
d. Rs.2030 d. the expenses incurred by fund
managers for marketing a mutual fund
4. A gilt fund is a special type of fund that scheme
invests :
a. in very high quality equity only 10. A mutual fund is owned by
b. in instruments issued by companies a. the Govt. of India
with a sound track record b. SEBI
c. in short-term securities c. all its investors
d. in government securities only d. AMFI

5. Of the following fund types, the highest risk 11. Units from an open-ended mutual fund are
is associated with bought
a. Balanced Funds a. on a stock exchange
b. Gilt Funds b. from the fund itself
c. Equity Growth Funds c. from AMFI
d. Debt Funds d. from a stock broker

6. The NAV of a mutual fund: 12. A mutual fund is not

a. is always constant a. owned jointly by all investors
b. keeps going up at a steady rate b. a company that manages investment
c. fluctuates with market price portfolios of high networth individuals
movements c. a pool of funds used to purchase
d. cannot go down at all securities on behalf of investors
d. a collective investment vehicle
7. An open-ended mutual fund is one that has:
a. an option to invest in any kind of 13. "Load" cannot be recovered
security a. at the time of the investor's entry into
b. units available for sale and repurchase the fund
at all times b. as a fixed amount each year
 c. at the time the investor exits the fund b. Growth Funds
d. from the fund's distribution agent c. Debt/Income funds
d. Sector funds
14. The most important advantage of a money
market mutual fund is 21. A Fixed Term Plan Series is
a. quick capital appreciation a. an open-ended fund
b. high regular income b. a close-ended fund
c. safety of principal c. a fixed term bank deposit
d. no loads d. a fixed term corporate bond

15. Some close-ended funds are quoted at a 22. NAVs of equity funds are not affected by
discount to their NAV because a. Stock market movements
a. of high expense ratios b. Events affecting the industry/sector in
b. investors do not expect the current which the fund has invested
NAV to be sustained in future c. Happenings in the companies in which
c. the repurchase price fixed by the fund the fund has invested
in lower than the NAV d. real estate prices
d. of the inherent risk involved in
investing in such type of funds 23. The greatest potential for growth in capital
is offered by
16. The NAV of each scheme should be a. debt funds
updated on AMFI's website b. gilt funds
a. every quarter c. growth funds
b. every month d. balanced funds
c. every hour
d. every day 24. A Systematic Withdrawal Plan, allows
investors to get back the principal amounts
17. Debt funds target invested in addition to the income on
a. low risk and stable income investment
b. protection of principal a. True
c. high growth with risk b. False
d. long term capital appreciation
25. Which of the following is untrue of an
18. In which of the following do debt funds not automatic reinvestment plan?
invest a. The plan allows for automatic
a. government debt instruments reinvestment of all income and capital
b. corporate paper gains
c. financial institutions' bonds b. Automatic reinvestment allows for
d. equity of private companies accumulation of additional units of the
fund
19. Which of the following risks do not affect c. The major benefit of automatic
a debt fund reinvestment is compounding
a. default by issuer on payment of d. The benefit of automatic reinvestment
interest or principal is often lost on account of the heavy
b. price fluctuations of the debt load charge on the reinvestment
securities
c. share price movements 26. Constraints imposed by most funds on
d. interest volatility check writing are:
a. Account balance should not fall below
20. Assured return or guaranteed monthly the minimum capital required
income plans are essentially b. Checks issued must be for at least the
a. Hybrid funds minimum amount specified.
 c. Number of checks per month must c. Market capitalisation and dividend
not exceed a specified number d. Market price and face value
d. Both a & b above
34. A company whose earnings are strongly
27. The performance of a fund is largely related to the state of economy is known as
measured by the success of a. Economy stocks
a. the marketing function b. Cyclical Stocks
b. the operations function c. Value Stocks
c. the portfolio market function d. Growth stocks
d. none of the above
35. A Growth stock refers to shares of a
28. Generally invest in company whose earnings are projected to
a. unlisted grow at the normal market rates
b. market-traded a. True
c. thinly traded b. False
d. privately placed
36. Which of the following is generally true for
29. Which of the following is not an equity a growth stock?
instrument a. steady capita appreciation and steady
a. preference shares dividends yields
b. equity warrants b. high capital appreciation and high
c. ordinary debentures dividend yields
d. convertible debentures c. high capital appreciation but low
dividend yields
30. The drawback of an ordinary share is d. steady capital appreciation but high
A. possibility of capital appreciation dividend yields
B. ownership privilege of the company
C. guaranteed dividend income 37. Shares of companies with large capital
D. no guaranteed income or security market capitalisation
a. have greater growth potential
31. An owner of preference shares is given b. are more liquid
which of the following rights c. are not available
a. voting rights d. none of the above
b. fixed dividend income from post-tax
profits 38. Dividend yield for a stock is
c. voting rights and unlimited dividend a. dividend per share
income b. dividend per face value
d. no guaranteed rights c. dividend per share to current market
price
32. Market capitalisation of a company is d. none of the above
calculated by multiplying the number of
outstanding shares by 39. Value stocks
a. R.10 a. have high current dividend yield
b. Face value of each share b. yield high growth in earnings
c. Current market value of each share c. are currently under valued
d. dividend yield d. none of the above

33. The Price/Earnings (P/E) Ratio is an 40. A better performance than the return on
important measure of a company's index is given by
anticipated performance. It is calculated using: a. passive fund manager
a. Market price and dividend b. an active fund manager
b. Market price and earning per share c. all fund managers
 d. non fund manager c. business channels on TV
d. offer document
41. A change in key personnel especially the e. AMFI Newsletter
fund manager of an AMC does not 48. Information on estimated expenses to be
necessitate a revision of the offer document incurred by a scheme is not found in the offer
a. True document, but in brochures of the fund
b. False a. True
b. False
42. If fresh litigation cases or adjudication 49. The offer document and key information
proceedings are referred by SEBI against the memorandum contain financial information
fund sponsors or a company associated with for
the sponsors, then the offer document needs a. all schemes of all mutual funds in the
to be revised capital market
a. True b. all schemes launched by the particular
b. False fund during the last 3 fiscal years
c. none of the schemes
43. The offer document need not be revised if d. companies in which investment is
the management or the controlling interest in proposed
the AMC change 50. The functions and responsibilities of the
a. True sponsor, AMC, trustees and custodian of the
b. False mutual fund are listed in
a. offer document only
44. An AMC cannot explain adverse variations b. key information memorandum
between expense estimates for the scheme c. both offer document and key
on offer and actual expenses for past information memorandum
schemes in d. none of the above
a. financial newspapers 51. Information about trusteeship fees is
b. business channels on TV included in the offer document but not in the
c. the offer document key information memorandum
d. AMFI newsletter e. True
f. False
45. Information on estimated expenses to be
incurred by a scheme is not found in the offer 52. The following information about the
document, but in brochures of the fund constitution of the mutual fund is found in
a. True both the offer document and key information
b. False memorandum
e. activities of the sponsor
46. When comparing a fund's performance f. summary of trust deed provisions
with that of its peer group, the following g. name and addresses of the board of
cannot be compared trustees
a. Two debt funds with 5 year maturities h. all of the above
b. A broad-based equity fund with an IT
Sector Fund 53. The investment objectives of the fund an
c. A bond fund with a bond investor selects for investment
d. A government securities fund with a e. are of no relevance
government security f. should be the same as his own
investment objectives
47. An AMC must explain adverse variation g. change with market movements
between expense estimates for the scheme h. change with change in the AMC's key
on offer and actual personnel
a. expenses for past schemes in
b. financial newspapers 54. The investment policies listed out in the
offer document of a fund do not include specified in the offer document, but only on
e. the type of securities in which the the application
scheme will invest principally e. True
f. asset allocation pattern f. False
g. policy of diversification
h. the specific securities in which the 60. Offer related information required to be
fund will invest listed in the offer document and key
information memorandum includes
55. If a scheme's name implies that it will e. dates of opening, closing, earliest
invest primarily in a particular type of security closing, allotment and despatch of
or in certain industry/sector, then it should certificates
invest at least the following percentage of its f. procedure for transfer and
total assets in the indicated type of transmission of units
security/industry/sector g. both the above
e. 100% h. neither of the above
f. 80%
g. 65% 61. In the offer document, funds are required
h. 40% to make disclosures summarizing associate
transactions and their impact on the
56. For assured return schemes, information performance of the scheme for the last
about the guarantor's net worth which justifies e. one fiscal year
the guarantor's ability to meet any shortfalls in f. 2 fiscal years
the returns assured under the scheme can be g. 3 fiscal years
found in h. 5 fiscal years
e. the offer document
f. the key information memorandum 62. The circumstances under which a scheme
g. both (a) and (b) shall be wound up are to be described in the
h. none of the above offer document at the time of the initial launch
of the scheme itself
57. The names and background of key e. True
personnel of the AMC f. False
e. need not be disclosed to investors
f. are of no relevance as they may 63. The following do not form a part of the
change investment procedure described in an offer
g. are disclosed in the offer document document
h. are declared in newspaper e. various plans under the scheme (e.g.
advertisements dividend reinvestment plant)
f. minimum initial (and subsequent)
58. The minimum amount to be raised, and investment
the maximum target amount g. details of who can invest
e. are not known before the offer is h. details of other competing mutual
concluded funds
f. can be decided based on investor
response to the offer 64. A scheme's policy on dividends and
g. are defined as per SEBI Regulations distribution
before the offer is made e. is decided by the fund manager as per
h. need not be disclosed in the offer is market outlook
document f. can be changed to suit the
requirements of the AMC
59. The circumstances for refund of g. need not be consistent
investment in the initial offer and period within h. should be disclosed at the time of
which refund must be carried out are not initial launch
65. SEBI restricts mutual fund investments in 71. The fund need not describe its accounting
companies forming part of the same group as policies in the offer document as these are of
the AMC. This is: no use to an investor
e. not true e. True
f. in the interest of investor protection f. False
g. applied only to some mutual funds,
not all 72. The accounting policies of a fund should
h. not favourable to investors at all be in accordance with
e. GAAP
66. A disclosure should be made in the offer f. SEBI regulations
document if an AMC has invested more than g. ICAI Guidelines
the following percentage of its net assets in h. American GAAP
group companies
e. 50% 73. Tax treatment of investments does not
f. 40% e. form a section in the offer document
g. 25% f. describe the tax elements applicable
h. 10% to investors who invest in the fund
g. form a section in the key information
67. Mutual funds are allowed to borrow memorandum
e. freely to meet their requirements h. offer tax advice to investors
f. for investment purposes
g. only to meet redemption demands 74. Documents available to investors for
h. not allowed at all inspection do not include
c. Memorandum and Articles of
68. As a part of borrowing policy, the following Association of AMC
need not be disclosed in an offer document d. consent of auditors and legal advisors
e. purpose and circumstances of e. investment management reports
borrowing f. reports based on which actual
f. regulatory limits on borrowing investments are made
g. potential risk to AMC and unit-holders
h. names of lenders 75. Investors' rights under a scheme are
e. uniform for all schemes of all funds
69. Valuation norms for non-traded securities f. not defined
should be disclosed g. listed in the offer document
e. at the end of every financial year h. available with stock exchanges
f. every quarter
g. in the offer document at the time of 76. The offer document for a scheme should
launch of the scheme describe how the NAV of the scheme is to be
h. should not be disclosed, being computed
confidential information e. True
f. False
70. Procedure for redemption or repurchase
need not 77. An offer document contains an AMC's
e. be described in the offer document investor grievance's history for the past
f. include how redemption or repurchase e. one fiscal year
price of units would be determined f. 2 fiscal years
g. include names of centres where g. 3 fiscal years
redemption can be effected h. six months
h. indicate the redemption or repurchase
price as at the end of the current fiscal 78. Any pending cases or penalties levied on
year the sponsors or AMC should be disclosed in
the offer document f. False
e. True
f. False 87. Commission rates or loads applicable to
big investors and small investors are
79. Who among the following are not eligible e. same
to invest in MF f. different
e. Indian Companies g. not charges to either
f. Banks h. none of the above
g. Non Banking Finance Companies
h. Foreign Citizens 88. What document Mutual Fund distributors
need to refer for finding out eligible category
80. NRIs are eligible to invest in Mutual Funds of investors in a particular Mutual Fund
e. True Scheme
f. False e. SEBI Regulations Manual
f. AMFI booklet
81. The most important link between Mutual g. Offer document
Fund and Investors is h. RBI Guidelines
e. Government
f. SEBI 89. As per AMFI figures, how many agents
g. Fund distributors approximately, are there in India selling
h. AMFI Mutual Funds
e. 50000
82. Are Overseas Corporate Bodies allowed to f. 100000
invest in Mutual Funds g. 75000
e. No h. 150000
f. Yes
g. if Ministry of Finance approves 90. Which Mutual Fund has majority of the
h. if AMFI approves agents selling its Mutual Fund units in India
e. LIC Mutual Fund
83. Who among the following are not f. UTI Mutual Fund
Institutional Investors g. SBI Mutual Fund
e. Banks h. None of the above
f. Resident Individuals
g. Provident Funds 91. Mutual Fund agents/distributors are not
h. Non Banking Finance Companies allowed to sell Financial Products other than
Mutual Funds
84. It is compulsory to use fund c. True
agents/intermediaries for investing MFs d. False
e. True
f. False 92. Are Mutual Fund agents/distributors in
India required to pass any examination to
85. Generally, which category of investors qualify to sell Mutual Fund Units
need advice for Investing in Mutual Funds c. Yes, a test conducted by AMFI
c. Non Banking Finance Companies d. Yes, a test conducted by SEBI
d. Insurance Companies e. No
e. Foreign Institutional Investors f. a Post Graduate university course
f. Individuals
93. How many major distributor Companies
86. Most eligible investors of Mutual Funds are there in India selling Mutual Fund units
can broadly be grouped into either individual c. approximately 9
or institutional investors d. approximately 11
e. True e. approximately 10
 f. approximately 25 g. market driven
h. common to all schemes
94. The offer document is not a legal i. of relevance to novice investors
document j. new to a regular investor
e. True
f. False 102. The risk of a scheme's NAV moving up or
down on the basis of capital market
95. A copy of all changes in the offer movements is a standard risk factor
document has to be filed with SEBI i. True
c. True j. False
d. False
103. Past performance of a sponsor/AMC
96. The legal responsibility for the accuracy of mutual fund is not indicative of the future
the statements made in the offer document performance of the scheme. This is
lies with i. not true
e. SEBI j. a standard risk factor for all schemes
f. the AMC k. a scheme-specific risk factor
g. AMFI l. applicable only to gilt funds
h. the Company Law Board
104. Risk arising from a scheme's investment
97. Though the offer document of a scheme is objective/strategy and proposed asset
prepared as per SEBI Regulations and is filed allocation is
with SEBI, SEBI does not certify the accuracy i. not present
or adequacy of the document j. common to all schemes
f. True k. specific to that scheme
g. False l. not applicable to debt funds

98. The following need not be covered in a 105. In an assured returns scheme, if
Key Information Memorandum assurance is only for a limited period, it must
c. Risk Factors be stated in the offer document that there is
d. Opening, Closing and earliest Closing no guarantee for sustaining the assured return
Date of the offer for the remaining duration of the scheme
e. Disclaimer Clause i. True
f. Functions and responsibilities of the j. False
sponsor, trustees, AMC and Custodian
responsibilities 106. If the AMC is managing a fund for the
first time, this information can be found in
99. The front page of an offer document need i. newspapers
not cover j. SEBI
e. opening, closing and earliest closing k. AMFI Newsletter
date of the offer l. Offer document
f. disclaimer clause
g. legal and regulator compliance 107. A compliance officer
h. price of units i. stands guarantee to the information
contained in the offer document
100. A "glossary" of Defined Terms must be j. belongs to SEBI
included in the offer document k. cannot certify that the AMC's legal and
e. True procedural obligations are fulfilled
f. False l. cannot be appointed by the AMC

108. The due diligence certificate that must be

101. Standard risk factors are not submitted to SEBI along with the draft offer
document cannot be signed by j. agents' responsibilities to the investor
i. the managing director of the AMC k. ethical code of conduct
j. an executive director of the AMC l. all of the above
k. the compliance officer
l. Investor relations officer 115. The following are not termed as "sales
practices"
109. A due diligence certificate does not i. agents commission
certify that j. before-and after-sales service to
g. the draft offer document forwarded to investors
SEBI is in accordance with SEBI k. advertising of schemes
regulations l. stock broking
h. all legal requirements connected with
launching of the scheme have been 116. Sales practices are never mandated by
complied with regulators, but arise from convention only
i. disclosures made in the offer i. True
document are true, fair and adequate j. False
j. the AMC guarantees a good
performance 117. Agents are compensated by mutual
funds
110. In developed countries, an important i. through salaries
Mutual Fund marketing channel is through j. through commissions
i. Insurance Companies k. through an annual fee
j. Banks l. not in cash but in kind
k. Non-Banking Finance Companies
l. Retail Distributors 118. In India the minimum or maximum
commissions payable to distributors are not
111. Emerging or new channel for prescribed by law, but are decided using the
distributors/marketing of Mutual Fund in India fund's own discretion
is i. True
i. Insurance Companies j. False
j. Banks
k. Qualified Mutual Fund agents 119. Lowest commissions are paid on
l. Direct Sales agents of respective i. Equity funds
mutual funds j. tax benefit schemes of mutual funds
k. debt funds
112. Mutual Funds often use their own l. long-term investments in mutual
employees to mobilise funds from funds
g. retail investors
h. High Networth individuals/institutional 120. Excess distribution expenses are to be
investors borne by the
i. all investors i. AMC
j. foreign investors j. unit holders
k. SEBI
113. Retail distribution channels are a critical l. AMFI
element in the distribution of mutual funds in
India 121. To cover fund distribution expenses,
i. True open ended funds
j. False g. charge a fee from agents
h. charge entry and exit loads from
114. "Sales Practices" cover the following investors
areas i. create a reserve
i. desirable marketing practices j. sell investments
 129. An agent's appointment by a fund
122. Trail commission means paying i. requires SEBI's approval
i. no commission at all j. is a lengthy and cumbersome process
j. the entire commission up-front k. is mandatorily preceded by an AMFI
k. part of the commission up-front and test
the balance in phases l. does not require any approval
l. the entire commission after five years
130. An investor does not have recourse to his
123. Sub-brokers serve as agents of the agent in case of errors, problems or the
principal broker and a mutual fund is not quality of the investment
answerable for their activities g. True
i. True h. False
j. False
131. An agent can offer and sell a funds's
124. In India, Mutual fund agents' rate and units at
services are at present defined by i. any price he chooses
g. SEBI rules j. a price determined by competition
h. stock exchange bye-laws among agents
i. AMFI rules k. a price based on demand for that
j. convention fund's units
l. the public offering price currently in
125. Along with the application, it is effect
mandatory to distribute
i. investment rebate 132. All buy orders through an agent do not
j. offer document become valid till the fund accepts and
k. key information memorandum confirms the orders
l. none of the above i. True
j. False
126. To sell funds effectively, an agent need
not 133. When an agent purchases, offers or sells
g. be fully aware of the important units, ensuring compliance with applicable
characteristics of the scheme regulations is the responsibility of
h. know his/her client's risk profile i. the fund
i. give after sales service j. the agent
j. offer large investment rebates k. AMFI
l. SEBI
127. For investors to correctly compare
performance of different funds SEBI's 134. The terms of appointment of a broker by
advertising codes include a fund are
i. uniform computation of yields g. laid down by SEBI
j. uniform presentations of dividends h. laid down by AMFI
k. identical time periods i. not uniform to all funds
l. all of the above j. none of the above

128. SEBI's advertising code mandate that all 135. The code of ethics for mutual funds
performance calculations in a fund's published by AMFI
advertisement should be based g. is mandatory
g. NAV h. is in the form of recommended
h. the NSE Fifty Index practices
i. the BSE Sensex i. is unfavourable to investors
j. none of the above j. does not cover distribution and selling
practices
 term
136. The AMFI code of ethics does not cover j. not allowed as per regulations
the following prescriptions
g. Adequate disclosures should be made 143. Net Asset Value (NAV) of a mutual fund
to the investors scheme is defined as the schemes
h. Funds should be managed in g. assets minus liabilities
accordance with stated investment h. assets per unit
objectives i. assets minus liabilities per unit
i. conflict of interest should be avoided j. none of the above
in dealings with directors or
employees 144. The day on which NAV is calculated by a
j. each investment decision should be fund is known as
approved by investors g. computation date
h. valuation date
137. Distribution and sales practices are only i. record date
partly regulated by SEBI at present j. book closure date
i. True
j. False 145. A funds NAV is affected by
e. Purchase and sale of investment
138. Which of the following distribution securities
channels is preferred by private mutual funds f. valuation of all investment securities
i. Individual Agents held
j. Small Distribution companies g. units sold or redeemed
k. established distribution companies h. all of the above
l. the Internet
146. When computing NAV of fund SEBI
139. Which of the following sales practices is requires accrual of major expenses to be
prescribed by regulation accounted
i. AMFI Code of Ethics i. quarterly
j. SEBI Advertising j. annually
k. AMFI's Code for Agents k. on a day to day basis
l. None of the above l. when actually paid

140. In a mutual fund investors' subscriptions 147. If a fund calculates NAV daily, it will
are accounted for as include all the transaction concluded up to
i. liabilities h. last week
j. deposits i. last two days
k. unit capital j. previous day
l. none of the above k. today

141. Investments made by a mutual fund on 148. For a open-ended fund,the repurchase
behalf of investors are accounted as price should not be lower than
e. assets g. NAV
f. liabilities h. 95% of NAV
g. capital i. 93% of NAV
h. none of the above j. 97% of NAV

142. Liabilities in the balance sheet of a 149. For a close-ended fund, the repurchase
mutual fund are price should not be lower than
g. in the form of long-term loans i. NAV
h. strictly short term in nature j. 95% of NAV
i. combination of long term and short k. 93% of NAV
 l. 97% of NAV (SEBI)
m. Fund Sponsor
150. For a scheme that has a load, the AMC n. Association of Mutual Funds of India
can change an investment management fee (AMFI)
not exceeding
g. 1.50% 156. The Board of Trustees of a mutual fund:
h. 2.00% m. act as a protector of investors'
i. 1.25% interests
j. 0.50% n. directly manage the portfolio of
151. Initial expenses of launching schemes securities
should not exceed o. do not have the right to dismiss the
k. 15% of amount received AMC
l. 10% of amount raised p. cannot supervise and direct the
m. 6% of amount raised working of the AMC
n. 5% of the amount raised
157. The AMC of a mutual fund cannot
152. Which of the following expenses cannot m. undertake advisory services or
be charged to the scheme financial consulting
k. Audit fees n. cannot invest the funds in government
l. costs related to investor paper
communication o. act as a trustee of more than one
m. winding costs for terminating the mutual fund
scheme p. cannot invest the funds in securities
n. penalties and fines for infraction of
laws 158. The trust that manages a mutual fund is
appointed by
153. Which of the following are not true for m. The Finance Ministry
Equity Linked Savings Schemes? n. R.B.I
m. Investors can claim an income tax o. SEBI
rebate p. The sponsor of that mutual fund
n. There is a lock-in period before
investment can be withdrawn 159. The custodian of a mutual fund:
o. There are not specific restrictions on k. is appointed for safekeeping of
investment objectives for the fund securities
managers l. need not be an entity independent of
p. These funds cannot invest in equity the sponsors
m. not required to be registered with SEBI
154. Which of the following is not true for n. does not give or receive deliveries of
Index Funds physical securities
m. These funds invests in the shares that
constitute a specific index 160. Transfer Agents of a mutual fund are not
n. The investment in shares is in the responsible for
same proportion as in the index m. issuing and redeeming units of the
o. These funds take only the overall mutual fund
market risk n. updating investor records
p. These funds are not diversified o. preparing transfer documents
p. investing the funds in securities
155. The structure which is required to be markets
followed by mutual funds in India is laid down
by 161. Distributors or agents
k. Financial Ministry m. can distribute several mutual funds
l. Securities & Exchange Board of India simultaneously
 n. cannot appoint sub-agents or sub- l. The Board of Trustees
brokers m. Agents and distributors
o. should be only individuals not n. Stock Brokers
companies or banks
p. should not be an employee or 169. The role of an AMC is to act as
associate of the AMC 13. promoters
14. investment managers
162. A transfer in the management of a close- 15. distribution agents
ended scheme does not require the consent 16. regulators
of
k. unit holders with 75% voting rights 170. A change in the following key people
l. SEBI does not materially impact the performance
m. Trustees of the fund
n. AMC m. Fund sponsors
n. Trustees of the fund
163. The fund sponsor has to contribute o. Fund Manager
k. nothing to the AMC p. Members of the AMFI Committee
l. the total networth of the AMC
m. atleast 40% of the AMC's networth 171. To transfer the management of a
n. exactly 50% scheme from one AMC to another, the
consent of the following is required
164. The sponsor of a mutual fund may be k. SEBI
compared to l. Unit holders
m. a director in a Company m. both SEBI and unit holders
n. the Chief Executive of a Company n. none of the above
o. Promoter of a Company
p. an equity shareholder in a Company 172. As per SEBI's principles, the AMC and the
Board of Trustees of a fund should belong to
165. Issuing and redeeming units of a mutual the same sponsors
fund is the role m. True
m. the custodian n. False
n. the transfer agent
o. the trustees 173. After UTI, the first mutual funds were
p. the bankers started by
k. private sector banks
166. The fund sponsors should have a sound l. public sector banks
financial track record of m. financial institutions
k. 7 years n. non-banking finance companies
l. 12 months
m. 5 years 174. The highest authority among the
n. 3 years following is the
k. SEBI
167. The networth of an asset management l. Company Law Board
company should be greater than m. RBI
m. Rs.100 Crores n. Ministry of Finance
n. can be decided by the Sponsor
o. should be atleast Rs. 10 Crores at all 175. The entity that SEBI does not regulate is
times m. share registrars
p. should be greater than Rs.10 Crores n. mutual funds
o. stock exchanges
168. The AMC and directors are answerable to p. non-banking finance companies
k. Stock Exchanges
176. The accounts and all other records of an m. provide merchant banking services
AMC are filed with n. invest in securities
k. AMFI
l. Registrar of Companies 183. The "Capital" of a scheme does not
m. Agents' Association include
n. UTI m. unit capital
n. reserves
177. A close-ended scheme of a mutual fund o. borrowing
is not governed by p. networth of the AMC
m. Exchange Rules of the stock exchange
where it is listed 184. Which of the following are Self
n. Listing Agreement between the fund Regulatory Organisations
and the stock exchange k. Bombay Stock Exchange
o. guidelines issued by the Ministry of l. SEBI
Commerce m. AMFI
p. Companies Act provisions relating to n. RBI
transactions in securities
185. A Self Regulatory Organisation can
178. The entry of mutual funds in India was regulate
initiated by mutual funds set up by k. all entities in the market
k. Public Sector Banks l. only its own members in a limited way
l. Private Sector mutual funds m. its own members with total
m. Unit Trust of India jurisdiction
n. mutual funds set up by insurance n. no entity at all
companies
186. The amount of authority enjoyed by a
179. For a close-ended scheme to change its 11. self-regulatory organisation is defined
fundamental attributes, it must obtain the by
consent of 12. the apex regulatory authority
m. 50% of unit holders 13. company law board
n. 50% of trustees 14. its own members
o. 75% of unit holders 15. RBI
p. none of the above
187. The role of AMFI in the mutual funds
180. The largest corpus of investable funds in industry is not to
India is with k. promote the interests of the unit
i. Bank-owned mutual funds holders
j. Private Sector mutual funds l. set a Code of Ethics
k. UTI m. regulate mutual funds in
l. Insurance Companies n. crease public awareness of mutual
funds in the country
181. The Board of Trustees of the UTI does
not have nominees from 188. The rights of investors in a mutual fund
m. RBI scheme are laid down in
n. LIC m. the Offer Document of that scheme
o. IDBI n. Quarterly Reports
p. The Bombay Stock Exchange (BSE) o. Annual Reports
p. marketing brochures
182. UTI Cannot provide
k. corporate finance 189. Unit holders of a mutual fund scheme do
l. engage in real estate and property not have a right to
development business m. proportionate ownership of the
 scheme's assets k. carefully studying the offer document
n. dividend declared for that scheme l. taking decisions about where the fund
o. dividend declared for other schemes managers should invest
of the mutual funds
p. income declared under that scheme 196. UTIs scheme US-64 falls under the
purview of SEBI
190. After dividend declaration, unit-holders m. True
are entitled to receive dividend within n. False
m. one week
n. one month 197. UTI was set up by
o. 42 days l. SEBI
p. six weeks m. AMFI
n. A special act
191. Unit holders' right to information does o. RBI
not include
i. obtaining from the trustees any 198. Bank owned Mutual Funds are
information having an adverse effect supervised by
on their investments k. SEBI
j. inspecting major documents of a fund l. RBI
k. receiving of a copy of the annual m. jointly by SEBI & RBI
financial statements of that fund n. AMFI
l. approving investment decisions of the
fund 199. Investor does not have the right to
receive any interest from an AMC if his
192. Shortfalls in the case of assured returns redemption proceeds are not despatched
schemes are met within 10 working days
k. by sponsors of such schemes m. True
l. only if the offer document specifically n. False
provided such a guarantee by a
named sponsor 200. If an investor failed to claim his
m. the Government of India redemption proceeds within 3 years, he can
n. AMFI claim the proceeds at
k. Par
193. Unit-holders aggrieved by a Fund or AMC l. Prevailing NAV
can get redressed from m. the on the date he has applied for
k. Consumer Courts redemption
l. SEBI n. 15% below the prevailing NAV
m. AMFI 201. After closure of the initial offer an open
n. RBI ended scheme, on going sales and
repurchases must start within
194. If the Directors of an AMC commit fraud, o. One week
Unit-holders investments' cannot be protected p. 30 days
by the Department of Company Affairs and q. 45 days
the Company Law Board r. 180 days
k. True
l. False 202. For scheme to be able to change its
fundamental attributes, it must obtain the
195. The responsibilities of a unit-holder do consent of
not include: o. 50% of the unit holders
i. Monitor his investments carefully p. 50% of the trustees
j. being aware of information that q. 75% of the unit holders
affects his investment in a major way r. none of the above
 209. 'Key Information Memorandum' is
203. The prospectus or Offer Document o. an abridged version of the offer
containing the details of new scheme is first document
registered with the p. the Memorandum & Articles of
q. AMFI Association of the AMC
r. SEBI q. a sheet containing historical NAVs of
s. Bombay Stock Exchange other fund schemes
t. Ministry of Finance r. Annual Report of the AMC

204. The offer document issued by mutual 210. The offer document for a scheme
funds does not serve the purpose of remains valid even if
q. announcing the scheme q. the AMC is reconstituted
r. giving detailed information about the r. entry or exit load are changed
scheme s. the scheme's NAV changes
s. inviting the the investors t. new plans are added to existing
t. giving the fund manager's investment schemes
outlook for the next quarter
211. The offer document has to be fully
205. The prospectus of a close-ended fund is revised and updated
issued q. every six months
o. every year r. once in two years
p. only once at the time of issue s. every quarter
q. every quarter t. every month
r. every six months
212. An addendum giving details of material
206. Fundamental attributes of scheme change in the offer document should be
q. do not include the objective of the circulated
scheme o. distributors/brokers
r. can be changed without the investor's p. unit holders
approval or knowledge q. SEBI
s. include the terms of the scheme r. all of the above
t. are not necessary for deciding
whether to invest in the scheme or not 213. Which of the following is not true for
offer documents of open-ended schemes
207. The offer document o. it is first issued at the time the
q. contains the terms of issue scheme is launched
r. gives no information relevant for p. it is registered with SEBI
making an investment decision q. it has to be revised periodically
s. is not the operating document r. it need not be revised at all
describing the scheme
t. cannot be called a reference 214. All important disclosures that the mutual
document fund is required to make, by regulation, are
contained in the offer document
208. SEBI does not require the following to be q. True
included in the offer document issued by a r. False
mutual fund
q. details of the Sponsor and the AMC 215. The offer document issued when an
r. Description of the Scheme & open-ended scheme is launched is valid for all
investment objective/strategy times, until amended
s. Investors' Rights and Services q. True
t. Performance of other mutual funds r. False
216 The most important source of q. Rs 2.50 crore
information for a prospective investor is r. Rs 3.00 crore
o. offer document
p. Annual Report of the AMC 225 A passive fund manager
q. Economic Times q. researches stocks extensively
r. AMFI Newsletter r. does not buy and sell stocks often
s. does not have to go through the
217 The offer document need not be studied process of stock selection
by an investor before investing in a scheme t. does not have to track stocks
q. True
r. False 226 A fund manager managing an index fund
o. has to keep fund expenses low
218 The offer document is not a legal p. does not have to research stocks
document q. does not have to balance his portfolio
o. True r. none of the above
p. False
227 A growth manager looks for
219 Initial issue expenses are charged to a q. high current income
scheme in the first year itself r. undervalued stocks
q. True s. above average earnings growth
r. False t. none of the above

220 Scheme-wise annual report of a mutual 228 A value manager does not look for
fund need not be o. stocks that are currently undervalued
q. sent to all unit-holders in the market
r. forwarded to SEBI p. stocks whose worth will be
s. published as an advertisement recognised by the market in the long
t. stock exchanges term
q. high current yield
221 Mutual funds value their investments r. long term capital appreciation
o. at purchase price
p. on a mark-to-market basis 229 From an investor's viewpoint, the most
q. at par important is
r. at book value q. a fund's investment style
r. performance of the fund
222 Investors are totally exempt from paying s. the fund manager's judgement
any tax on the dividend income they receive t. none of the above
from mutual funds
o. True 230 Fundamental analysis involves
p. False m. checking the foundations of the
company's factory building
223 Income distributed to unit-holders by a n. research into the operations and
debt fund is liable to dividend distribution tax finances of the company
o. True o. studying the company's share prices
p. False p. none of the above

224 A close-ended has average weekly net 231. Which of the following is not considered
assets of Rs 200 crore.As per SEBI for technical analysis
regulations, the AMC can charge the fund with q. historical data on the company's share
investment and advisory fees upto: price
o. Rs 2.25 crore r. the company shares' trading volume
p. Rs 2.00 crore s. current market sentiment
 t. the company's regulatory environment
239. Derivatives cannot be based on market
232. Quantitative analysis is more likely to be indices
done to evaluate a particular sector or q. True
industry rather than any specific stock r. False
o. True
p. False 240. In a mutual fund, the overall decisions on
allocating money to particular
233. Fundamental analysis forms the basis to industries/sectors are taken by
decide q. equity analysts
q. when to buy a given share r. fund managers
r. whether to buy a given share or not s. security dealers
s. whether to use technical analysis or t. trustees
quantitative analysis
t. whether the company's factory can 241. Continuous tracking of the companies in
withstand earthquakes which a mutual fund has invested is done by
m. continuous tracking systems
234. Technical analysis guides the decision on n. equity analysts
o. whether to buy or sell o. trustees
p. the right time to buy or sell p. security dealers
q. whether company's technical
personnel are adequately qualified 242. Security dealers of a mutual fund
r. none of the above o. guard the cabin of the fund manager
p. execute buy and sell orders for the
235. Which of the following is not an fund
investment philosophy q. decide which shares to buy or sell
o. capitalising on economic cycles r. none of the above
p. focusing on growth sectors
q. capitalisation 243. As per SEBI's requirements each scheme
r. finding value stocks of a mutual fund should have a different fund
manager
236. When expecting a fall in market price, o. True
fund managers can reduce the loss in p. False
portfolio value by
p. speculating 244. Debt securities bought at a discount to
q. not buying and selling shares at all for their face value are generally
some days m. interest bearing
r. using equity derivatives n. zero coupon bonds
s. giving TV interviews to improve o. paying interest at a floating rate
sentiment p. none of the above

237. Equity derivative instruments are 245. In India, a large part of debt securities
o. shares pay interest on
p. bonds m. a floating rate basis
q. contracts n. a fixed rate plus a variable portion
r. notes o. a fixed rate
p. zero coupon basis
238. A futures contract allows one to buy or
sell the underlying shares, but need not result 246. The Indian debt market is largely
in delivery wholesale in nature
q. True o. True
r. False p. False
 u. par value
247. In the wholesale debt market, the largest v. face value
proportion of trading is seen in w. fair value
16. Government Securities x. redemption value
17. Corporate Bonds
18. T-Bills 255. Coupon of a debt security refers to
19. PSU Bonds s. a piece of paper attached to the
certificate
248. The largest proportion of trades done in t. the return on investor would earn
the wholesale debt market is accounted by u. the amount rate of interest paid on par
o. mutual funds value of the bond
p. foreign banks v. none of the above
q. Indian banks
r. financial institutions 256. Which of the following do not apply to
the term 'maturity' of a debt security?
249. Certificates of Deposits (CDs) are issued u. the date on which the certificates
by becomes old
o. Regional Rural Banks v. the term of the bond
p. Corporates w. the date of redemption
q. Scheduled commercial banks x. the date on which the issuer has to
r. none of the above repay the amount

250. Commercial Paper is issued by Corporate 257. Call or put provisions are used to modify
bodies the fixed maturity of debt securities
o. to meet short-term working capital u. True
requirements v. False
p. to finance the acquisition of long term
capital assets 258. A call provision in a debt issue allows the
q. to retire long term debt issuer to
r. to pay dividend u. call out the names of the investors
251. Government securities are issued v. redeem the debt on maturity
through the RBI w. extend the tenure of the debt
s. True x. redeem the debt before maturity
t. False
259. A put provision in a debt issue allows
252. The yield on Treasury Bill (T-Bill) us 19. investor to put away the certificates in
determined by safe deposit vaults
s. the Government of India 20. investors to redeem debt prior to
t. auction maturity
u. the State Governments 21. issuers to redeem debt prior to
v. floating rate method maturity
22. investors to extend the tenure of debt
253. Which of the following are not normally
found in the portfolio of a debt fund 260. Current yield relates interest on a
u. long-dated Government Securities security to
v. Corporate debentures u. its current market price
w. bonds issued by financial institutions v. its face value
x. certificates of deposit issued by banks w. its fair value
x. the current price of T-Bills
254. Which of the following do not represent
the amount an investor of a debt security will 261. To compare bonds with different coupon
be paid upon maturity rates, maturities and prices, investors would
use: s. yield extra
u. current yield t. yield premium
v. technical analysis
w. yield to maturity 269. A high credit rating does not mean
x. fundamental analysis s. high yield spread
t. high perceived safety
262. When interest rates rise, bond prices u. low yield spread
19. also rise v. low risk premium
20. fall
21. are not affected 270. If 10-year government securities Neil 10%
22. fluctuate either up or down and a 10-Year fixed deposit in a company
yields 12%, the yield spread is
263. Yield curve is also known as u. 12%
s. Curve of Interest v. 22%
t. Term Structure of Interest Rates w. 10%
u. Curve that yields x. 2%
v. none of the above
271. The "duration" of an interest-bearing
264. An important indicator of expected bond is
trends in interest rates is s. longer than its maturity
s. The Economic Times t. less than its maturity
t. the Sensex u. equal to its maturity
u. the Yield Curve v. the quality of paper used for the
v. the Chief Minister's Speech certificate

265. It may not be possible to reinvest interest 272. A bond with a coupon of 9% when
received at the same rate as principal. This is interest rates for similar maturities are 11%
known as will sell
s. reinvestment risk q. above par
t. inflation risk r. below par
u. interest-rate risk s. at par
v. call risk t. at a price unrelated to the prevailing
interest rate
266. A bond's rating indicates its
s. reinvestment risk 273. Changes in foreign exchange rates have
t. default risk no bearing on interest rates
u. inflation risk q. True
v. interest-rate risk r. False

267. If a bond cannot be sold at a price near 274. Inflation and interest rates are inversely
its value, it means that investment in this proportional
bond has s. True
s. high liquidity risk t. False
t. high default risk
u. low liquidity risk 275. Investment policies of a mutual fund are
v. inflation risk determined by
u. the fund manager
268. The additional yield required to account v. the AMC management
for the risk of default by the borrower is w. the marketing department based on
known as what distributors want
q. yield plus x. the investors
r. yield spread
276. Which of the following measures are not
taken by SEBI for protecting investors of 283. A mutual fund may transfer investments
mutual funds from one scheme to another
s. mandating minimum levels of u. not at all
diversification for mutual funds v. at current market rates
t. ensuring that the funds are not used w. at cost price
to favour a few companies x. at a fixed premium over market rate
u. tracking the securities that each fund
has invested in 284. Interest Rate Risk for an Indian debt fund
v. ensuring that the funds are invested in can be reduced by using
approved securities only s. Futures
t. Options
277. As per SEBI norms, a fund's investments, u. Interest Rate Swaps
in the equity shares of any one company are v. none of the above
restricted to
u. 25% of NAV 285. The Interest Rate Forecasting Unit of a
v. 10% of NAV debt fund is generally manned by
w. 50% of NAV s. technicians
x. 100% of NAV t. statisticians
u. economists & econometricians
278. A mutual fund manager is not allowed to v. accountants
sell short when he expects a crash in the
market 286. AMCs need not maintain records in
s. True support of each investment decision
t. False t. True
u. False
279. In a mutual fund, having many schemes,
al securities bought can be held in a general 287. When interest rates for similar maturities'
account and transferred later to various bonds are 11%, bond with a 9% coupon rate
schemes to attain certain profit or loss will sell
objectives s. above par
u. True t. below par
v. False u. at par
v. at a price unrelated to the interest
280. A mutual fund may invest in short-term rates for similar securities
deposits of scheduled commercial banks
q. True 288. The most suitable measure for a fund's
r. False performance does not depend on the
s. type of fund
281. Mutual funds are allowed to lend t. investment objective of the fund
u. loans u. financial market conditions
v. securities v. amount invested by investor
w. physical assets
x. none of the above 289. If the NAV of an open-ended fund was
Rs.16 at the beginning of the year and Rs.22
282. In case of listed securities of group after 13 months, the annualised change in
companies of the sponsor, mutual fund is not NAV is
allowed to invest s. 6.0%
q. 25% of its net assets t. 34.6%
r. 10% of its net assets u. 40.6%
s. at all v. 37.5%
t. >5% of net assets
290. Change in NAV as a measure of fund t. Bond fund
performance is more suitable for
u. growth funds 297. The Expense Ratio is not affected by
v. income funds t. fund size
w. funds with withdrawal plans u. average account size
x. none of the above v. portfolio composition
w. stock market conditions
291. The difference between NAV change and
total return as measures of fund performance 298. The Income Ratio as a measure of a
is fund's performance is defined by the fund's
q. none s. total income and total assets
r. total return takes dividend into t. net investment income and net assets
account while NAV change does not u. total income and net assets
s. total return does not take NAVs into v. none of the above
account
t. total return does not take the time 299. The Income Ratio is more suitable for
period into account evaluating the performance of
s. Equity Funds
292. The most suitable measure of fund t. Growth Funds
performance for all fund types is u. Regular Income Funds
s. NAV Change v. Index Funds
t. Total Return
u. Total Return with reinvestment 300. Portfolio turnover rate of a fund measure
v. none of the above the
s. size of the fund's portfolio
293. The expense ratio used for measuring t. amount of buying and selling done by
fund performance is an indicator of the fund
q. product market condition u. the average number of units sold by
r. growth in the economy the fund in one day
s. prevalent market practices v. none of the above
t. the fund's efficiency 301. A high turnover rate for a fund indicates
u. high transaction costs
294. The Expense Ratio as a measure of a v. greater efficiency
fund's performance is defined by a fund's w. high returns to the investor
q. total expenses and average net assets x. a rising market
r. total expenses and total assets
s. average expenses and average net 302. Turnover rates would be most relevant to
assets analyse the performance of
t. none of the above w. equity funds
x. growth funds
295. While computing the Expense Ratio for a y. debt funds
fund, brokerage commissions on the fund's z. value funds
transactions are not included in the fund
expenses 303. Transaction costs include
q. True y. all expenses related to trading
r. False z. all expenes charged to the fund
aa. distribution expenses
296. The Expense Ratio is not of utmost ab. none of the above
importance in case of
q. Debt fund 304. Which of the following are not included in
r. Index fund Transaction costs?
s. Equity fund y. brokerage commissions
 z. stamp duty on transfers y. BSE Sensex
aa. custodians fees z. S&P CNX Nifty
ab. agent commissions aa. BSE 200
ab. S&P CNX Sectoral Indices
305. Which of the following transaction costs
are not quantified in the offer document 312. To evaluate a close-ended debt-fund, a
w. brokerage commissions suitable benchmark would be
x. dealer spreads w. BSE Sensex
y. custodian's fees x. I-Sec's I-BEX
z. registrar's fees y. interest on bank fixed deposits of
similar maturity
306. The size of a fund has no bearing on its z. S&P CNX Defty
performance
y. True 313. When comparing performance of two
z. False funds, the following need not be similar
w. Risk profiles
307. As per SEBI, mutual funds can borrow for x. Investment objectives
short term to the extent of y. Fund size
w. total net assets z. Fund managers
x. 50% of net assets
y. 25% of net assets 314. Which of the following is false?
z. 20% of net assets w. ROI is a measure similar to Total
Return with Reinvestment of
308. Which of the following is of no relevance distribution
in evaluating a fund's performance x. Total Return with Reinvestment of
y. The performance of the stock market distributions assumes reinvestment at
as a whole NAV on the distribution date
z. The performance of other mutual y. As a measure of performance, Total
funds Return with Reinvestment of
aa. The returns given by other comparable distribution seeks to overcome the
financial products shortcomings of simple Total Return
ab. The change in wholesale price index z. Because of its simplicity, simple Total
Return is preferred in practice to Total
309. The choice of an appropriate benchmark Return with Reinvestment of
for evaluating a fund's performance depends distribution
on
w. the fund manager 315. The basis of genuine investment advice
x. the investment objective of the fund should be
y. SEBI 23. the current market situation
z. AMFI 24. the agent commissions paid by
different funds
310. An actively managed equity fund expects 25. financial planning to suit the investor's
to situation
y. be able to beat the benchmarks 26. planning to complete the agent's
z. earn the same returns as the annual targets
benchmark
aa. have no benchmarks 316. Financial goals do not include
ab. underperform when compared with w. buying a home
the benchmark x. winning a sports gold medal
y. planning for retirement
311. For evaluating funds, the preferred z. saving for child's education
benchmark would be the
317. Financial planning allows a person u. True
w. to become a billionaire v. False
x. to achieve financial goals through
proper management of finances 325. Financial planning does work for older
y. to invest in foreign countries clients
z. none of the above y. True
z. False
318. Financial plans do not alter in any way
the amount of tax an investor pays as the tax 326 Financial planning is primarily tax
is on his income planning
u. True w. True
v. False x. False

319. Which of the following works with an 327 In financial planning, all responsibility
investor on his overall financial situation ends with the financial planner and the client
w. Tax Advisor has no responsibilities
x. Financial Planner y. True
y. Insurance Agent z. False
z. Financial Advisor
328 The constraint on financial planning due
320. A financial planner takes responsibility to insufficient investable resources can be
for the financial well-being of his/her clients remedied to some extent by
y. True u. decreasing the standard of living
z. False v. disciplining children
w. disciplined monthly budgeting
321. Financial planners and their clients x. none of the above
should focus on
w. allocating funds to asset classes (e.g. 329 In the growth option offered by mutual
debt, equity etc.) funds, the number of units held by an investor
x. allocating funds to individual increases because of
securities w. growth in net asset value i.e. capital
y. tracking stocks which they feel have appreciation
potential x. reinvestment of dividend which is like
z. none of the above compounding
y. interest received on the fund's assets
322. Within an asset class, which individual z. none of the above
security to invest in should be decided by
u. the financial planner 330 To maximise returns on investment, once
v. the investor himself an investor buys into a fund, he/she should
w. a professional fund manager hold on to it no matter what happens
x. an objective advisor s. True
t. False
323. Financial Planning comprises
s. defining a client's profile and goals 331 If an investor keeps investing a fixed
t. recommending appropriate asset amount at regular intervals, the average cost
allocation of his purchases will always be less than if he
u. monitoring financial planning makes investment at irregular periods
recommendations y. True
v. all of the above z. False

324. Financial planning is relevant only for 332. Which of the following lets an investor
high networth individuals book profits in a rising market and increase
holdings in a falling market
u. Fixed Rates of Asset Allocation 338. Which of the following investment
v. Flexible Ratio of Asset Allocation products do not give guarantee for return or
w. Investment without any asset capital
allocation plan w. Bank deposits
x. Buy and Hold Strategy x. Pubic provident fund (PPF)
y. National Savings Certificates (NSC)
333. A Flexible Ratio of Asset Allocation z. Units of a mutual fund
means
y. continuously changing the ratio of 339. The biggest advantage of investment in
various assets in the portfolio gold is
z. not doing any re-balancing and letting w. High returns
the profits run x. High appreciation in value
aa. active switching y. Low Purchase price
ab. none of the above z. Hedge against inflation

334. The strategy advisable for an investor to 340. The biggest disadvantage of investment
maximise investment return in the long run is in real estate is
w. buy and hold on to investments for a y. Less potential for capital appreciation
long time z. High purchase price
x. liquidate poorly performing aa. Depreciation in value as time passes
investments from time to time ab. Value gets eroded due to inflation
y. liquidate good performing
investments fro time to time 341. Which of the following is not an
z. switch from poor performers to good advantage of bank deposits?
performers u. Liquidity
v. High perceived safety
335. A criticism of rupee-cost averaging is w. Low entry price
w. Investment is for the same amount at x. High yield after tax
regular intervals
x. Over a period of time, the average 342. Listing of shares at a stock exchange
purchase price will work out higher ensures
than if one tries to guess the market w. guaranteed returns
highs and lows x. long term capital appreciation
y. It does not tell you when to buy, sell or y. low risk
switch from one scheme to another z. high liquidity
z. Rupee cost averaging has no serious
shortcomings 343. The rate of interest paid by a company
on debentures issued by it depends on
336. In India, individual investors do not have u. the stock market situation
direct access to v. SEBI guidelines
v. capital market instruments w. the company's credit rating
w. real estate x. the amount of money being raised
x. bullion
y. money market instruments 344. Which of the following is not a
characteristic of company fixed deposits
337. Which of the following entities can given u. A higher rate of interest
loans against securities v. higher risk
w. UTI w. unfavourable effect of tax
x. Banks x. very high liquidity
y. Mutual funds
z. none of the above 345. Which of the following is untrue for
Public Provident Fund Schemes ad. 8 years
s. The interest is tax-free
t. Post-tax returns are attractive 353. The annual yield on RBI Relief Bonds is
u. Liquidity is rather low ac. 9.5%
v. none of the above ad. 9.5% before tax
ae. 8.5% before tax
346. Indira Vikas Patra is an investment af. 8.5% after tax
product popular with
u. rural investors 354. Individual investors do not normally
v. investors in high tax bracket invest in Government Securities because
w. urban investors ac. individual investors re not allowed to
x. risk taking investors invest in Government Securities
ad. the amount required for investment is
347. Finance Acts of 2000 and 2001 have very large
reduced tax-free interest on Public Provident ae. safety of principal is not guaranteed
Fund to af. none of the above
x. 12%
y. 10.5% 355. The amount an insurance company
z. 9% would pay to the nominee if a policyholder
aa. 11% died is known as the
aa. premium
348 Most individuals invest in life insurance ab. sum assured
policies for ac. face value
w. risk protection ad. real value
x. tax benefits
y. easy liquidity 356. Dividends distributed by mutual funds
z. high returns are
aa. taxed at source
349. Annual contribution to Public Provident ab. taxed in the hands of the investors
Fund should be ac. are subject to capital gains tax
w. Rs.10000 ad. are tax-free in the hands of the
x. between 100 and Rs.6000 investor
y. between Rs.600 and Rs.1000
z. none of the above 357. Investing through mutual fund is a better
option than investing directly in the stock
350. The current yield on Indira Vikas Patra market because
works out to identifying stocks is a difficult process
w. 10.5% agents get commissions on mutual fund investment
x. 11% returned are guaranteed by mutual funds
y. 10% all of the above
z. 9%
351. The tenure of an Indira Vikas Patra is 358. A small investor can build a diversified
y. 7 years portfolio by
z. 6 years aa. buying one share each of all listed
aa. 5 years companies
ab. 3 years ab. investing in a mutual fund
ac. borrowing enough money to buy
352. The maturity period of RBI Relief Bonds shares of well-managed companies
is ad. none of the above
aa. 5 years
ab. 6 years 359. Which of the following is not an
ac. 7 years advantage of mutual fund investment over
direct investment
ac. Higher liquidity 366. Greater returns come only from assuring
ad. Lower transaction costs higher risks, and a higher risk portfolio
ae. Greater convenience guarantees higher returns
af. guaranteed returns aa. True
ab. False
360. There is no contractual guarantee for
repayment of principal or interest to an 367. The risk tolerance of an investors is
investor in independent of
aa. bank deposit aa. his age
ab. debt fund ab. his income
ac. secured debentures ac. the stock market movements
ad. all of the above ad. his job security

361. Which of the following debt investments 368. A sector fund is a

is not rated aa. low risk fund
ac. Corporate Bonds ab. moderate risk fund
ad. Commercial Paper ac. high risk fund
ae. Company Deposit ad. low-to-moderate risk fund
af. Debt Fund
369. International funds invest in various and
362. Gold and real estate are attractive so are low risk funds
investment options only in high inflation w. True
economies x. False
ac. True
ad. False 370. Investment in gold is a hedge against
inflation but investment in a precious metal
363. Direct investment in stock market can be fund falls in the high risk category
a better option than investing through mutual aa. True
funds if the investor ab. False
aa. wants better returns than those
offered by mutual funds 371. By their very nature, growth funds are
ab. has large capital, knowledge and considered as high risk funds
resources for research aa. True
ac. has identified a bullish phase in the ab. False
stock market
ad. wants to invest for the long term 372. Short Term bond funds are
aa. low risk funds
364. Deciding on strategies such as long-term ab. moderate risk funds
compounding, cost averaging, value averaging, ac. high risk
active switching, all depend on the ad. of the above depending on the market
aa. stock market situation on date
ab. amount of money to be invested 373. The risk level of commodity funds is
ac. investor's risk tolerance y. high risk category
ad. phase through which the economy is z. determined by the commodity price
passing movements
aa. cannot be specified
365. Financial Planning involves ab. low risk category
aa. studying financial management
ab. managing the risks of investing 374. As compared to a fund with fluctuating
ac. financing the client's investments total returns, a fund with stable positive
ad. none of the above earnings
 w. gives higher returns v. It is based on past returns, which does
x. is less risky not necessarily indicate further
y. gives lower returns performance
z. is more risky w. It is an independent number
x. All types of funds can be measured
375. "Risk" is equated with with standard deviation
w. volatility of earnings
x. level of earnings 382. The role of an agent is to
y. the number of investors in a fund aa. point out the features and benefits of
z. the number of schemes of a fund various investments options
family ab. help the investor develop the right
approach to investing
376. Volatility of an equity fund portfolio is ac. recommend some investment option
independent of the available
aa. kind of stocks in the portfolio ad. offer ad hoc advise whenever the
ab. degree of diversification of the investor has surplus money available
portfolio
ac. fund manager's success at market 383. One of the most effective ways to invest
timing through mutual funds is to
ad. number of investors in the scheme y. develop a model portfolio
z. buy a few units of every mutual fund
377. Equity price risks are scheme available
y. company specific aa. invest all the money in one fund
z. market level scheme
aa. sector specific ab. invest all the money in different
ab. all of the above schemes of the same fund family

378. Diversification reduces 384. Mutual fund should be advised to expect

aa. company specific risk ac. low post tax returns
ab. market level risk ad. dramatic results
ac. both of the above ae. better returns than every other
ad. none of the above available option
af. only realistic wealth accumulation
379. Which of the following is most risky? goals
y. Investing in a money market mutual
fund 385. Asset Allocation is
z. Investing in an index fund aa. keeping certificates of the physical
aa. Short term investment in an equity securities in proper places
fund ab. allocation the available money to all
ab. Long term investment in an equity the securities available
fund ac. allocating the right proportion of funds
to equity, debt and money market
380. A fund with a high beta coefficient gives securities
greater returns in a rising market, and is more ad. none of the above
risky in a falling market
aa. True 386. Once a financial advisor works out ideal
ab. False Asset Allocation, it can be used for all
investors whom he/she advises
381. Which of the following is a disadvantage aa. True
of Standard Deviation as a measure of risk ab. False
u. Standard Deviation measures total
risk, not just market risk 387. Asset distribution among equity, debt
and money market securities should
correspond to the investors' need for capital 394. Retired investors should
growth, income and liquidity y. not draw down on their capital
z. True z. not invest in securities which bear risk
aa. False of capital erosion
aa. continue holding a major portion of
388. The liquidity needs of an investor are met their holding in equity growth funds
through ab. never invest in equity
aa. Equity Funds
ab. Index Funds 395. For older investors who want to transfer
ac. Money Market Funds their wealth
ad. Sector Funds y. no financial planning is required
z. the right investment strategy depends
389. A retired person generally needs a upon who the beneficiaries are
greater proportion of aa. the right investment strategy depends
aa. Debt funds upon the state of the stock market
ab. Equity funds ab. all the funds can be invested in
ac. Money Market funds aggressive equity funds
ad. All of the above
396. Investors who acquire sudden wealth
390. To satisfy a young investor's need for w. can speculate with all the acquired
growth, a greater proportion of investment money in the stock markets
should be advised in x. should not use any of the new wealth
aa. Gilt funds to invest in equity
ab. Income Funds y. should take the effect of taxes into
ac. Equity Growth funds account
ad. Liquid funds z. need not pay any taxes on the newly
acquired wealth as it is not a part of
391. A very high proportion of investment in their regular income
all types of equity funds is advisable for
investors 397. Only if a specialty offshore fund has
ac. in distribution phase consistently given very good performance, it
ad. in accumulation phase can be considered for investment by a retiree
ae. in transition phase y. True
af. who are wealth preserving affluent z. False
individuals
398. Past performance should not be solely
392. The transition phase of an investor's relied on for selecting a fund
wealth cycle is when ab. True
y. the financial goals have been already ac. False
met
z. the investor has retired 399. Between the past performance of a fund
aa. financial goals are approaching and its suitability for an investor, past
ab. investor suddenly gets a windfall performance is more important
aa. True
393. A high proportion of investment in ab. False
income funds is required by
aa. accumulating investors 400. Structural characterisations of an equity
ab. affluent investors fund include
ac. investors in the inter-generational aa. costs of investing
transfer phase ab. the specific securities in which the
ad. investors in the distribution phase fund has invested
 ac. the number of employees of the AMC af. The Trustees
ad. all of the above ag. The Registrars
401. An equity fund's age and size are ah. The custodians
irrelevant when selecting a fund for
investment 408. In case of a fund merger or Take-over
ac. True ag. High Court approval may not be
ad. False necessary
ah. SEBI approval is a must
402. The charge to an investor at the time of ai. all unitholders must be informed
he redeems his units from the fund is known aj. all of the above
as
ae. recovery charge 409. Units of a money market mutual fund can
af. repurchase load be issued to
ag. redemption weight ae. individuals
ah. exit load af. banks
ag. trusts
403. The load amount charged to a scheme ah. all of the above
over a period of time is called
ag. entry load 410. Though Indian mutual funds have
ah. exit load restrictions on borrowings (only20% of net
ai. deferred load assets and for six months only) which are to
aj. no-load meet cash needs for redemption only, UTI is
allowed to borrow within more relaxed norms
404. Contingent Deferred Sales Charge (CDSC) ag. True
ag. is higher for investors who stay ah. False
invested in the scheme longer
ah. is lower for investors who stay 411. An equity fund can be said to be
invested in the scheme longer concentrated when
ai. is the same for all investors ae. when it invests in only in two or three
irrespective of how long they stay stocks
invested af. when it invests in may companies of
aj. is not allowed to be charged to mutual the same sector
fund investors in India ag. when top ten holdings account for
more than 50% of net assets invested
405 A fund's declared NAV does not include ah. when top ten holdings account for
loads more than 25% of net assets invested
ae. True
af. False 412. The size of the market capitalisation of a
fund's equity holdings is inversely proportional
406. Which of the following fund types are to the returns that
comparable ae. can be expected from the fund
ae. An aggressive equity fund and a af. level of risk assumed by the fund
money market mutual fund ag. state of the stock market
af. A value fund and a government ah. all of the above
securities fund
ag. A bond fund and a debt fund 413. A steady holding of investments in an
ah. A diversified equity fund and a debt equity fund's portfolio indicates
fund ae. long-term orientation
af. lower transaction costs
407. Who is the primary guardian of ag. both the above
unitholders' funds/assets ah. none of the above
ae. The AMC
414. Ex-Mark of an equity fund measures its ae. narrow
ae. performance af. higher
af. risk ag. the same
ag. both the above ah. almost nil
ah. none of the above
422. Debt funds with long-term investments
415. Beta of an equity fund measures its carry higher risk of capital loss
ac. performance ac. True
ad. risk ad. False
ae. both the above
af. none of the above 423. The differerentiating factor among debt
funds of comparable maturity and quality is
416. The best equity fund, relative to others, aa. gross yields
would have ab. costs
ae. higher Ex Marks, lower Beta and ac. fund age
higher Gross Dividend Yield ad. tenure of the fund manager
af. higher Ex Marks, higher Beta and
higher Gross Dividend Yield 424. Distribution tax should be taken into into
ag. lower Ex Marks, lower Beta and lower account when computing net returns from
Gross Dividend Yield aa. equity funds
ah. lower Ex Marks, higher Beta and ab. debt funds
higher Gross Dividend Yield ac. both the above
ad. none of the above
417. When selecting equity funds for investing,
those at the top of the performance rankings 425. All debt fund investors are exposed to
should be avoided risk of principal loss
ae. True ae. True
af. False af. False

418. A debt fund's age and size are not 426. Running a money market mutual fund
important when selecting a fund for requires more of
investment ac. credit analysis skills
y. True ad. equity analysis skills
z. False ae. patience
af. trading skills
419. Debt schemes are popular because
ac. the Indian Stock Market is always 427. Which is the most important in selecting
going down debt fund for better return
ad. the returns are more predictable ae. past performance
ae. most investors are always in debt af. level of interest rates
af. all of the above ag. fund expertise
ah. the securities in which it has invested
420. Yield-to-maturity of a debt fund's
portfolio is more important when the 428. Investors should be advised to avoid
investment objective is investing in a debt fund with a
ac. current income ac. lower rated portfolio and higher
ad. total return expense ratio
ae. liquidity ad. higher rated portfolio and lower
af. all of the above expense ratio
ae. lower rated portfolio and lower
421. Compared to equity funds, income expense ratio
margins for debt funds are af. lower rated portfolio and higher
 expense ratio ah. is held by the mutual fund without
buying or selling
429. An ideal money market mutual fund must
have 435. An Ex-Mark of 100% is possible for
ac. lower returns ac. a growth fund
ad. lower expense ratio ad. an aggressive growth fund
ae. low quality of investments ae. an index fund
af. all the above af. a balanced fund

430. Circumstances that might cause an 436. A trail commission is justified when
investor to change the composition of his ab. an investor cancels his investment
portfolio ac. the investor redeems his investment
y. cyclical changes in economy in a very short time
z. unforeseen economic changes ad. an agent invests his own money, not
affecting the portfolio's preferred that of a client
sectors ae. an agent sells many mutual funds
aa. both the above
ab. none of the above 437. Of the following, which type of fund
would have a higher P/E multiple in
431. If a charitable trust approaches a comparison to the average market multiple
distributor with an application for investment ae. A Value Fund
in a mutual fund, the distributor should af. A Growth Fund
ae. accept the application without wasting ag. An Index Fund
time ah. Could be any of the above three, one
af. reject the application outright cannot generalise
ag. refer to the offer document
ah. accept the application as a direct 438. Which of the following is not true as per
application SEBI Regulations for Debt Funds?
ae. Investment in rated debt securities of
432. An application form for investment in a a single issuer should not exceed 15%
mutual fund is available with of NAV
ac. the offer document af. Total investment in unrated debt
ad. the abridged annual report securities of a single issuer should not
ae. the key information memorandum exceed 25% of NAV
af. a bank challan ag. Total investment in unrated debt
securities below investment grade
433. An aggrieved unit-holder of a mutual fund should not exceed 25% of NAV
can sue ah. Total investment in rated debt
ag. the AMC securities below investment grade
ah. the trustees should not exceed 25% of NAV
ai. the sponsor if returns have been
guaranteed by them 439. A Money Market Mutual Fund is most
aj. none of the above likely to invest in
ae. Corporate Bonds
434. As per SEBI regulations for valuation of af. Equity Shares
investments held by mutual funds, a security ag. Government Securities with maturity
is considered "non-traded" when it less than 1 year
ae. has not been traded for 60 days prior ah. All of the above
to valuation
af. has not been traded for 30 days prior 440. Of the following, which would be suitable
to valuation for a retiree with a modest risk appetite
ag. is not listed on any stock exchange ag. Value Fund
 ah. Diversified Equity Fund ad. has the same status as a unit-holder
ai. Growth Fund of a fund
aj. Balanced Fund ae. can sue the AMC/trustee
af. has no legal recourse
441. A high portfolio turnover for a fund ag. all of the above
indicates
ac. that the fund is active 448. An investor can assess the performance
ad. higher transaction costs of his mutual fund by comparing it with the
ae. both the above performance of
af. none of the above ac. other mutual fund of the same type
ad. the stock market
442. Unit Trust of India's US-64 Scheme ae. other financial products
ae. is listed on stock exchanges af. all of the above
af. has a fixed price for sale and
repurchase 449. Unrated securities in the portfolio of a
ag. has its sale and repurchase price mutual fund are not to be valued
declared periodicaly by UTI ae. True
ah. has its price determined by market af. False
forces
450. An exit load guarantees a higher return
443. The Indian debt market aa. True
ac. is Wholesale in nature ab. False
ad. comprises large players like financial 451 Bonds held in the portfolio of a mutual
institutions and banks fund are valued at yield to maturity
ae. witnesses large scale trading in ae. True
government securities af. False
af. all of the above
452 The Valuation of non-traded equity shares
444. A fund that charges a load is better than is done at the trading price 30 days prior to
a no-load fund valuation date
ac. True ai. True
ad. False aj. False

445. An AMC can approach investors either 453 If a unit-holder does not agree to the
directly or with the help of merger of his fund with another, he has not
aa. individual agents exit option
ab. banks and non-banking finance ak. True
companies al. False
ac. distribution companies
ad. all of the above 454. The most important factor look for when
investing in a corporate fixed deposit is the
446. Which of the following is true for Equity ak. yield
Linked Savings Scheme (ELSS) al. rate of interest
aa. A tax rebate is available to investors in am.credit rating of the deposit
these schemes an. none of the above
ab. The investment has to be locked in for
3 years 455. The most important reason for an
ac. The minimum amount for investment investor to prefer a bank deposit to a mutual
is fixed fund is
ad. All of the above ag. the credit worthiness of the bank
ah. because the bank does not invest in
447. A prospective investor securities
 ai. that the bank offers a guarantee
aj. all of the above 462. Mutual fund units can be distributed by
ai. trustees of the fund
456. A deep discount bond aj. the AMC
ai. is always sold at a discount to its ak. Non-banking finance companies
issue price al. banks
aj. bears interest annually
ak. is redeemed at a price much higher 463. A debt fund distributes 10% dividend.
than issue price How much tax does the investor have to pay
al. bears interest at varying interests on this dividend?
ai. 10%
457. A mutual fund in India is a aj. 12%
ai. body corporate ak. 20%
aj. company al. None
ak. trust
al. an asset management company 464. A debt fund distributes a 10% dividend.
How much tax does the fund have to pay?
458. When selling a mutual fund, a good agent ai. 10%
would never aj. 12%
ak. describe the past performance of the ak. 10.2%
scheme al. None
al. compare the fund with other mutual
funds 465. How many scrips is the NIFTY
am.assure a rate of return constitutes of
an. compare the fund with other financial ag. 40
products ah. 100
ai. 30
459. An investor buys one unit of a fund at an aj. none of the above
NAV of Rs.20. He receives a dividend of Rs.3
when the NAV is Rs.21. The unit is redeemed 466. Which of the following is the first step in
at an NAV of Rs.22. Total Return is financial planning
ai. 25.71% ai. Asset Allocation
aj. Rs.27.51 aj. Selection of fund
ak. 21.27% ak. Studying the features of a scheme
al. Rs.21.75 al. None of the above

460. A fund sells 100 units of face value 467. Why should one buy an insurance policy?
Rs.10/- at an NAV of Rs.12.25. How much ag. It gives high current returns
would be credited to unit capital? ah. It gives good capital appreciation over
ai. Rs.1225 its term
aj. Rs.225 ai. It should be bought due to the need
ak. Rs.1000 for insurance and not as an
al. none of the above investment
aj. All of the above
461. When a scheme with assured returns is
being launched, which of the following need 468. SEBI Regulations for Mutual Funds were
not be published in the offer document? formulated in
ai. Means of fulfilling the guarantee aa. 1992
aj. Information for all schemes launched ab. 1993
by the fund in the past ac. 1995
ak. comparison with other mutual funds ad. 1996
al. Investment objective
469. Expenses incurred by a fund for printing ag. High liquidity
of Key Information Memorandum can be ah. diversification
amortised over ai. no tailor made portfolio
ag. 10 Yrs aj. low investment
ah. 5 Yrs
ai. 15 Yrs 476. A disadvantage suffered by mutual fund
aj. Cannot be amortised investor is that he has no control over the
costs of investing
470. A mutual funds' investments are guided ag. True
by the ah. False
ag. AMC
ah. Board of Trustees 477. Which of the following statements about
ai. Investment Objectives UTI is untrue
aj. Unit holders ai. It was set up in 1963
aj. It was formed by RBI
471. UTI was the only mutual fund for the ak. It was established by an act of
period Parliament
ai. 1984 to 1988 al. It was not given a monopoly status
aj. 1963 to 1988
ak. 1964 to 1992 478. Which scheme has the largest investor
al. none of the above base?
ag. ULIP
472. Investors who follow the fixed Asset ah. UTI Mastershare
Allocation approach ai. US-64
ae. maintain balance in their portfolio by aj. SBI Magnum
liquidating a part of the position in the
asset class which has given higher 479. Which was the first diversified equity
return and reinvesting in the other investment scheme in India
asset class which has lower return ag. SBI Magnum
af. are not disciplined ah. UTI Mastershare
ag. increase their equity position when ai. MEP-91
equity prices tend to climb aj. Mastergain-92
ah. none of the above
480. The private sector was granted
473. An investor should not invest in a mutual permission to enter the mutual fund industry
fund if in
ae. his capital base is large ac. 1992
af. he is able to carry out detailed ad. 1993
investment research and monitor the ae. 1998
stock market af. 1995
ag. both the above
ah. none of the above 481. The first non-UTI mutual fund was
ai. SBI MF
474. Mutual fund can benefit from economies aj. LIC MF
of scale because of ak. Canbank MF
ae. portfolio diversification al. Indian Bank MF
af. risk reduction
ag. large volume of trades 482. The organisation responsible for a
ah. none of the above comprehensive set of regulations for all
mutual funds in India is
475. Which of the following is a disadvantage ag. RBI
suffered by a mutual fund investor? ah. SEBI
 ai. AMFI aj. required by the AMC for its own
aj. SHCIL reference
ak. required as per SEBI regulations
483. The 1999 Union Government Budget al. not mandatory as per SEBI
helped the Mutual Fund industry by
ak. regulating the industry practices 489. The units of a scheme being sold and
al. exempting all mutual fund dividends in repurchases as per the procedure laid down is
the hands of investors from income one of the fundamental attributes of a
tax scheme
am.approving the code of ethics ai. True
formulated by AMFI aj. False
an. doing away with all regulations for
mutual funds 490. The steps involved in the selection of an
equity fund for investment are
484. During the period 1992-99, the ak. sector selection, asset classification,
mobilisation of funds by the mutual fund selection of fund managers and
industry was about schemes
ai. 5% - 6% of gross domestic savings al. sector selection, selection of fund
aj. 2% - 4% of gross domestic savings managers and schemes, asset
ak. 7% - 10% of gross domestic savings classification
al. 25% - 40% of gross domestic savings am.asset classification, sector selection,
selection of fund managers and
485. Which of the following about Public schemes
Providend Fund (PPF) are untrue an. selection of fund managers and
ag. 50% of the balance of the 4th year can schemes, sector selection, asset
be withdrawn in the 7th year classification
ah. The interest is tax free
ai. The rate of interest is 12% p.a. 491. Compounding of interest is best
aj. contributions upto Rs.60000 are explained by a
eligible for tax rebate ag. balanced fund
ah. growth fund
486. A close-ended scheme is quoted on the ai. value fund
stock exchange at a discount to its NAV when aj. income fund
af. the markets are bearish
ag. investors perceive that the fund will be 492. From whom can a unit-holder seek
unable to maintain the NAV redressal if his complaint is not entertained by
ah. the assets of the fund are undervalued the mutual fund
ai. none of the above ai. AMC
aj. Board of Trustees
487. Which of the following is a fundamental ak. SEBI
attribute of a mutual fund scheme al. RBI
ai. The names and addresses of the
registrars and custodians 493. An investor wishes to switch between a
aj. The nature of the scheme being money market mutual fund and an equity fund.
income bearing What would you advise him?
ak. The specified stocks in the scheme's ag. It would be better to stick to one type
portfolio of fund, the one that meets his
al. The name and address of the investment objective.
compliance officer ah. He should keep switching parts of his
investment from the equity fund to the
488. Offer Document of a mutual fund is money market fund as the market
ai. required by investors rises and switch back to the equity
 fund when the market falls ah. sell short maturity securities and buy
ai. He should switch from the money long maturity securities
market fund to the equity fund in a ai. see that the fund's average duration
rising market and switch back to becomes longer than the market's
money market fund when the market average duration
falls aj. sell long duration securities and buy
aj. none of the above short duration securities
ak. sell high coupon securities and buy
494. For choosing an appropriate benchmark low coupon securities
to measure a scheme's performance, all of the
following are required except 498. In which type of schemes should an
ae. the composition and size of the unmarried professional working HLL invest
portfolio ag. Scheme investing 80% in debt
af. the investment objective securities
ag. historical data of fund performance ah. 50% in equity funds and 50% in
ah. the nature of investments income funds
ai. 90% in equity funds having a higher
495. Which of the following characterise the P/E Ratio than the market
fund that a risk averse investor should choose aj. all the money in a balanced fund
ae. Gross dividend yield 15% Beta 1.5, Ex-
Marks 90 499. An investor buys units in a fund that has
af. Gross dividend Neil 10%, Beta 1, Ex- given excellent returns in the past, but his
Marks 70 expectations are not met as the fund does not
ag. Gross dividend yield 11%, Beta 0.9, Ex- perform well this year. The investor can
Marks 80 ag. sue the AMC
ah. Gross dividend yield 12%, Beta 1.2, Ex- ah. sue the Trustees
Marks 80 ai. sue the agent
aj. none of the above
496. A mainstream diversified debt fund is
most affected by 500. A fund's investments at market value
ae. reinvestment risk total Rs.700 crores, Total liabilities stand at
af. liquidity risk Rs.50 lacs and the number of units
ag. interest rate risk outstanding is Rs.28 Crores. What is the NAV
ah. default risk ac. Rs.30.19
ad. Rs.24.98
497. If yields fall, a debt fund manager will do ae. Rs.32.15
all of the following except af. Rs.40.49
Answers to Practice Question
Q. Ans Q. No Ans Q. No Ans Q. No Ans Q. No Ans
No
1 b 51 a 101 d 151 c 201 b
2 b 52 d 102 a 152 d 202 d
3 d 53 b 103 b 153 d 203 b
4 d 54 d 104 c 154 d 204 d
5 c 55 c 105 a 155 b 205 b
6 c 56 c 106 d 156 a 206 c
7 b 57 c 107 a 157 c 207 a
8 c 58 c 108 d 158 d 208 d
9 d 59 b 109 d 159 a 209 a
10 c 60 d 110 b 160 d 210 c
11 b 61 c 111 b 161 a 211 b
12 b 62 a 112 c 162 d 212 d
13 d 63 d 113 a 163 c 213 d
14 c 64 d 114 d 164 c 214 a
15 b 65 b 115 d 165 b 215 a
16 d 66 c 116 b 166 d 216 a
17 b 67 c 117 b 167 c 217 b
18 d 68 d 118 a 168 b 218 b
19 c 69 c 119 c 169 b 219 b
20 c 70 d 120 a 170 d 220 d
21 b 71 b 121 b 171 c 221 b
22 d 72 b 122 c 172 b 222 a
23 c 73 d 123 a 173 b 223 b
24 a 74 d 124 d 174 d 224 a
25 d 75 c 125 c 175 d 225 c
26 d 76 a 126 d 176 b 226 a
27 c 77 c 127 d 177 c 227 c
28 b 78 a 128 a 178 c 228 c
29 c 79 d 129 d 179 c 229 b
30 d 80 a 130 a 180 c 230 b
31 b 81 c 131 d 181 d 231 d
32 c 82 b 132 a 182 b 232 a
33 b 83 b 133 b 183 d 233 b
34 b 84 b 134 c 184 c 234 b
35 b 85 d 135 b 185 b 235 c
36 c 86 a 136 d 186 a 236 c
37 b 87 b 137 a 187 c 237 c
38 c 88 c 138 c 188 a 238 a
39 a 89 b 139 b 189 d 239 b
40 b 90 b 140 c 190 b 240 b
41 b 91 b 141 a 191 d 241 b
42 a 92 c 142 b 192 b 242 b
43 b 93 c 143 c 193 b 243 a
44 c 94 b 144 b 194 a 244 b
45 b 95 a 145 d 195 d 245 c
46 b 96 b 146 c 196 b 246 a
47 c 97 a 147 d 197 c 247 a
48 b 98 d 148 c 198 c 248 c
49 B 99 c 149 b 199 b 249 c
50 A 100 a 150 c 200 a 250 a
Answers to Practice Question for AMFI Test
A A A A A
Q. No n Q. No n Q. No n Q. No n Q. No n
s s s s s
251 a 301 a 351 b 401 b 451 a
252 b 302 a 352 a 402 c 452 b
253 d 303 a 353 d 403 c 453 b
254 c 304 d 354 b 404 b 454 c
255 c 305 b 355 b 405 a 455 a
256 a 306 b 356 d 406 c 456 c
257 a 307 d 357 a 407 c 457 c
258 d 308 d 358 b 408 d 458 c
259 b 309 b 359 d 409 d 459 a
260 a 310 a 360 b 410 a 460 c
261 c 311 d 361 d 411 c 461 c
262 b 312 c 362 a 412 b 462 d
263 b 313 d 363 b 413 c 463 d
264 c 314 d 364 c 414 a 464 c
265 a 315 c 365 b 415 b 465 d
266 b 316 b 366 b 416 a 466 a
267 a 317 b 367 c 417 a 467 c
268 b 318 b 368 c 418 a 468 d
269 a 319 b 369 b 419 b 469 b
270 d 320 a 370 a 420 b 470 c
271 b 321 a 371 b 421 a 471 b
272 b 322 c 372 b 422 a 472 a
273 b 323 d 373 a 423 a 473 c
274 b 324 b 374 b 424 b 474 c
275 b 325 a 375 a 425 a 475 c
276 c 326 b 376 d 426 d 476 a
277 b 327 b 377 d 427 c 477 d
278 a 328 c 378 a 428 a 478 c
279 b 329 b 379 c 429 b 479 b
280 a 330 b 380 a 430 c 480 b
281 b 331 a 381 b 431 c 481 a
282 a 332 a 382 b 432 c 482 b
283 b 333 b 383 a 433 c 483 b
284 c 334 d 384 d 434 b 484 a
285 c 335 c 385 c 435 c 485 c
286 b 336 d 386 b 436 b 486 b
287 b 337 b 387 a 437 b 487 b
288 d 338 d 388 c 438 b 488 c
289 c 339 d 389 a 439 c 489 a
290 a 340 b 390 c 440 d 490 c
291 b 341 s 391 b 441 c 491 b
292 c 342 d 392 c 442 c 492 c
293 d 343 c 393 d 443 d 493 b
294 a 344 d 394 b 444 b 494 c
295 a 345 d 395 b 445 d 495 c
296 c 346 c 396 c 446 d 496 c
297 d 347 b 397 b 447 a 497 c
298 b 348 b 398 a 448 d 498 c
299 c 349 b 399 b 449 b 499 d
300 b 350 a 400 b 450 b 500 b