Question 1

A minimum start-up capital of about ______________is required for close-ended schemes

Accepted Answer

A)  150 million
B)  100 million
C)  350 million
D)  200 million A

Question 2

_______________ schemes not exposed to sudden and large movements of funds.

Accepted Answer

A)  Fixed maturity plan
B)  Open-Ended Funds
C)  Close-Ended Funds
D)  Interval fund C

Question 3

______________ are considered high-risk funds but also tend to provide high returns.

Accepted Answer

A)  Equity Fund
B)  Money Market Funds
C)  Balanced or Hybrid Funds
D)  Debt Funds A

Question 4

The Mutual fund industry follows which of the following regulation?

Accepted Answer

A)  SEBI (Mutual fund)  regulations 1996
B)  Mutual fund regulation 2004
C)  Mutual fund regulation 2003
D)  RBI

Question 5

Who establishes the Mutual Fund in India?

Accepted Answer

A)  Securities Exchange Board of India
B)  Asset Management Company
C)  Sponsor
D)  Shareholders

Question 6

The funds in which units can be purchased only during the initial offer period are called

Accepted Answer

A)  Open-Ended Fund
B)  Close-Ended Funds
C)  Interval Funds
D)  Fixed maturity plan

Question 7

___________ is a type of investment vehicle consisting of a portfolio of stocks, bonds, or other securities.

Accepted Answer

A)  Government Securitie
B)  Mutual Funds
C)  Derivatives
D)  Shares

Question 8

The feature of a mutual fund, where it spreads the investment in varied stocks and sectors by pooling the funds of various investors, is called as ______________.

Accepted Answer

A)  Professional Management
B)  Affordability
C)  Diversification
D)  Profit

Question 9

_______________ Mutual fund company was set up as a joint venture between RBI and Government of India

Accepted Answer

A)  UTI MF
B)  LIC MF
C)  SBI MF
D)  ICICI MF

Question 10

____________ are funds that invest in company debentures, government bonds and other fixed-income assets.

Accepted Answer

A)  Equity Fund
B)  Money Market Funds
C)  Balanced or Hybrid Funds
D)  Debt Funds

Question 11

Presently there are __________ AMC in India

Accepted Answer

A)  40
B)  50
C)  44
D)  39

Question 12

Dividend income received from mutual in the hands of unit holders

Accepted Answer

A)  Fully Taxable
B)  Fully Exempt
C)  Partly Exempt
D)  Partly Taxable

Question 13

_____________ are also known as the protectors of the fund and are employed by the fund sponsor.

Accepted Answer

A)  Sponsor
B)  Trustees
C)  Asset Management Company
D)  Custodian

Question 14

A _________________ is a trust that pools the savings of a number of investors who share common financial goals.

Accepted Answer

A)  Share
B)  Mutual Funds
C)  Government Securities
D)  Derivatives

Question 15

The value of one unit of investment in Mutual fund is called the _______________.

Accepted Answer

A)  Net Asset Value
B)  Issue value
C)  Market value
D)  Gross Asset value

Question 16

Nippon India Pharma fund is an example of ______________.

Accepted Answer

A)  Sector Fund
B)  Index Funds
C)  Equity funds
D)  Global funds

Question 17

Which of the following is not a limitation of mutual funds?

Accepted Answer

A)  No guarantee of return
B)  Fees and Expenses
C)  Poor Performance
D)  Professional Management

Question 18

What are the reasons for economies of scale to the benefit of Mutual funds?

Accepted Answer

A)  Large volumes of trade
B)  Portfolio diversification
C)  Risk reduction
D)  Loss

Question 19

What is the full form of NAV?

Accepted Answer

A)  Net Assessment Value
B)  National Asset Value
C)  Net Asset Value
D)  National Asset variation

Question 20

HDFC Sensex ETF is an example of ____________.

Accepted Answer

A)  Sector Fund
B)  Index Funds
C)  Fund of funds
D)  International funds

Exam 1: Understanding the Basics of Mutual Funds in India