Indian Capital Market MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Indian Capital Market, a fundamental topic in the field of IC 89 Management Accounting. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Indian Capital Market MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of Indian Capital Market mcq questions that explore various aspects of Indian Capital Market problems. Each MCQ is crafted to challenge your understanding of Indian Capital Market principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC 89 Management Accounting tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Indian Capital Market MCQs are your pathway to success in mastering this essential IC 89 Management Accounting topic.

Note: Each of the following question comes with multiple answer choices. Select the most appropriate option and test your understanding of Indian Capital Market. You can click on an option to test your knowledge before viewing the solution for a MCQ. Happy learning!

So, are you ready to put your Indian Capital Market knowledge to the test? Let's get started with our carefully curated MCQs!

Indian Capital Market MCQs | Page 13 of 15

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Q121.
What condition is deemed to be satisfied under Section 41 for issuing depository receipts?

a.

Obtaining approval from the Ministry of Finance

b.

Passing a resolution by the Board of Directors

c.

Approval from the Reserve Bank of India (RBI)

d.

Special resolution passed under Section 62 for the issue of shares underlying the depository receipts

Discuss
Answer: (d).Special resolution passed under Section 62 for the issue of shares underlying the depository receipts Explanation:A special resolution passed under Section 62 for the issue of shares underlying the depository receipts is deemed to be a special resolution for the purpose of Section 41.
Q122.
What is the responsibility of the company regarding compliance with the Scheme and regulatory guidelines, according to the Companies (Issue of Global Depository Receipts) Rules, 2014?

a.

Compliance is not necessary

b.

Compliance is the sole responsibility of the Reserve Bank of India (RBI)

c.

The company shall ensure compliance with the Scheme and regulatory guidelines

d.

Compliance is overseen by the Ministry of Finance

Discuss
Answer: (c).The company shall ensure compliance with the Scheme and regulatory guidelines Explanation:The company is responsible for ensuring compliance with the Scheme and regulatory guidelines issued by the Reserve Bank of India (RBI).
Q123.
Who can oversee all the compliances relating to the issue of depository receipts, according to the rules?

a.

Any company executive

b.

Any shareholder of the company

c.

Merchant banker, practicing Chartered Accountant, practicing Cost Accountant, or practicing Company Secretary

d.

Reserve Bank of India (RBI)

Discuss
Answer: (c).Merchant banker, practicing Chartered Accountant, practicing Cost Accountant, or practicing Company Secretary Explanation:A merchant banker, practicing Chartered Accountant, practicing Cost Accountant, or practicing Company Secretary can oversee all compliances relating to the issue of depository receipts.
Q124.
In what form can depository receipts be issued, as per the manner and form rules?

a.

Only through public offering

b.

Only through private placement

c.

Only in a manner prevalent abroad

d.

Through public offering, private placement, or any other manner prevalent abroad

Discuss
Answer: (d).Through public offering, private placement, or any other manner prevalent abroad Explanation:Depository receipts can be issued through public offering, private placement, or any other manner prevalent abroad, according to the manner and form rules.
Q125.
Against what can depository receipts be issued, according to the rules?

a.

Only against issue of new shares

b.

Only against issue of existing shares

c.

Only against issue of bonus shares

d.

Against issue of new shares or sponsored against shares held by shareholders of the company

Discuss
Answer: (d).Against issue of new shares or sponsored against shares held by shareholders of the company Explanation:Depository receipts may be issued against issue of new shares or may be sponsored against shares held by shareholders of the company.
Q126.
To whom are the underlying shares allotted in the depository receipt issuance process?

a.

Overseas depository bank

b.

Domestic custodian bank

c.

Shareholders of the company

d.

Reserve Bank of India (RBI)

Discuss
Answer: (a).Overseas depository bank Explanation:The underlying shares are allotted in the name of the overseas depository bank in the depository receipt issuance process.
Q127.
When is a holder of depository receipts entitled to vote as a member of the company?

a.

Only after conversion of depository receipts into underlying shares

b.

Before conversion of depository receipts into underlying shares

c.

Only during the issuance of depository receipts

d.

Both before and after conversion of depository receipts

Discuss
Answer: (a).Only after conversion of depository receipts into underlying shares Explanation:A holder of depository receipts is entitled to vote as a member of the company only after the conversion of depository receipts into underlying shares.
Q128.
Who is entitled to vote on behalf of the holders of depository receipts until their conversion?

a.

Holders of depository receipts

b.

Overseas depository

c.

Company shareholders

d.

Reserve Bank of India (RBI)

Discuss
Answer: (b).Overseas depository Explanation:Until the conversion of depository receipts, the overseas depository is entitled to vote on behalf of the holders of depository receipts in accordance with the provisions of the agreement.
Q129.
What role does the financial system play in economic growth?

a.

Facilitating international trade

b.

Mobilisation of savings, formation of capital, and canalizing funds into the production process

c.

Managing inflation rates

d.

Regulating government expenditures

Discuss
Answer: (b).Mobilisation of savings, formation of capital, and canalizing funds into the production process Explanation:The financial system plays a crucial role in economic growth by mobilizing savings, forming capital, and channeling funds into the production process.
Q130.
What is the capital market primarily concerned with?

a.

Short-term financial instruments

b.

Real estate transactions

c.

Long-term financial instruments

d.

Consumer loans

Discuss
Answer: (c).Long-term financial instruments Explanation:The capital market deals with relatively long-term financial instruments, such as equity shares, preference shares, bonds, ADRs, GDRs, and derivatives.
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