Investment of Insurance Companies And IRDA Regulations MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Investment of Insurance Companies And IRDA Regulations, 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 Investment of Insurance Companies And IRDA Regulations 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 Investment of Insurance Companies And IRDA Regulations mcq questions that explore various aspects of Investment of Insurance Companies And IRDA Regulations problems. Each MCQ is crafted to challenge your understanding of Investment of Insurance Companies And IRDA Regulations 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 Investment of Insurance Companies And IRDA Regulations MCQs are your pathway to success in mastering this essential IC 89 Management Accounting topic.

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Investment of Insurance Companies And IRDA Regulations MCQs | Page 2 of 16

Discover more Topics under IC 89 Management Accounting

Q11.
What does Par Value refer to in the context of bonds?

a.

Market value of the bond

b.

The value of the bond at the time of issue

c.

The promised face value of the bond at maturity

d.

The interest payable to the bondholder

Discuss
Answer: (c).The promised face value of the bond at maturity Explanation:Par Value refers to the face value of the bond and the amount the issuer promises to pay at the time of maturity.
Q12.
What is Coupon Rate in the context of bonds?

a.

The market interest rate

b.

The rate of return on investment

c.

The rate of interest payable to the bondholder

d.

The rate of tax on bond income

Discuss
Answer: (c).The rate of interest payable to the bondholder Explanation:Coupon Rate refers to the rate of interest payable to the bondholder.
Q13.
When does Maturity date of a bond occur?

a.

At the time of issue

b.

After the bondholder receives interest payments

c.

When the principal amount is payable by the borrower to the bondholder

d.

On the date of purchase

Discuss
Answer: (c).When the principal amount is payable by the borrower to the bondholder Explanation:Maturity date refers to the date when the principal amount of borrowings is payable by the borrower to the bondholder.
Q14.
What is the characteristic of Money Market Investments in terms of maturity?

a.

Maturity of more than one year

b.

Maturity of exactly one year

c.

Maturity of less than one year

d.

No fixed maturity

Discuss
Answer: (c).Maturity of less than one year Explanation:Money Market Investments are debt instruments with a maturity of less than one year at the time of issue, including Treasury Bills, Commercial papers, and Certificate of Deposits.
Q15.
How are Mutual Fund Investment schemes broadly classified?

a.

Profit and non-profit schemes

b.

Equity and hybrid schemes

c.

Short-term and long-term schemes

d.

Active and passive investment schemes

Discuss
Answer: (b).Equity and hybrid schemes Explanation:Mutual fund Investment schemes are broadly classified into Equity Schemes, Debt Schemes, and Balanced funds, among others.
Q16.
What is the significance of Real Estate investment?

a.

Provides steady income with low risk

b.

Draws tremendous attention of investors

c.

Has a short maturity period

d.

Is mainly focused on agricultural land

Discuss
Answer: (b).Draws tremendous attention of investors Explanation:Real estate investment has drawn the tremendous attention of investors due to its good rate of return on investment.
Q17.
What is the primary purpose of Financial Derivatives?

a.

Providing steady income

b.

Speculative purposes

c.

Minimizing return on investment

d.

Offering low-risk investment

Discuss
Answer: (b).Speculative purposes Explanation:Financial Derivatives, such as Options and Futures, are used for hedging risks as well as speculative purposes.
Q18.
Which of the following is considered a non-marketable financial asset?

a.

Treasury Bills

b.

Company deposits

c.

Commercial papers

d.

Mutual Fund Investments

Discuss
Answer: (b).Company deposits Explanation:Non-marketable financial assets include forms like bank deposits, post office deposits, company deposits, and provident fund deposits.
Q19.
How is the rate of return on an investment calculated for a period?

a.

[Annual income + Price at Beginning] / Price at End

b.

[Annual income + (Price at End - Price at Beginning)] / Price at Beginning

c.

[Annual income - (Price at End - Price at Beginning)] / Price at End

d.

[Annual income - Price at Beginning] / Price at End

Discuss
Answer: (b).[Annual income + (Price at End - Price at Beginning)] / Price at Beginning Explanation:The rate of return on an investment for a period is calculated using the formula: Rate of Return=Annual income+(Price at End−Price at Beginning)Price at BeginningRate of Return=Price at BeginningAnnual income+(Price at End−Price at Beginning)​
Q20.
What does Risk on Investment refer to?

a.

Probability of earning high returns

b.

Chance of loss of expected return on investment

c.

Marketability of investment

d.

Tax benefits on investment

Discuss
Answer: (b).Chance of loss of expected return on investment Explanation:Risk on Investment refers to the chance of loss of expected return on investment.
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