Mutual Fund,Venture Capital,Life Insurance Policies and AIFS MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Mutual Fund,Venture Capital,Life Insurance Policies and AIFS, 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 Mutual Fund,Venture Capital,Life Insurance Policies and AIFS 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 Mutual Fund,Venture Capital,Life Insurance Policies and AIFS mcq questions that explore various aspects of Mutual Fund,Venture Capital,Life Insurance Policies and AIFS problems. Each MCQ is crafted to challenge your understanding of Mutual Fund,Venture Capital,Life Insurance Policies and AIFS 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 Mutual Fund,Venture Capital,Life Insurance Policies and AIFS MCQs are your pathway to success in mastering this essential IC 89 Management Accounting topic.

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Mutual Fund,Venture Capital,Life Insurance Policies and AIFS MCQs | Page 3 of 18

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Q21.
How can mutual fund schemes be utilized for asset allocation?

a.

By investing only in equity funds

b.

By investing only in debt funds

c.

By allocating funds to equity and debt simultaneously

d.

By avoiding asset allocation

Discuss
Answer: (c).By allocating funds to equity and debt simultaneously Explanation:One can use mutual fund schemes for asset allocation by investing in equity and fixed income instruments in different proportions.
Q22.
Who decides the proportion of allocations of funds in various assets in mutual fund schemes?

a.

Individual investors

b.

Financial planners

c.

Fund managers

d.

Government authorities

Discuss
Answer: (c).Fund managers Explanation:The fund manager decides in what proportion the allocations of funds will be made in various assets.
Q23.
What is highlighted as a tax efficiency benefit of investing in mutual funds?

a.

Higher tax rates

b.

Limited tax benefits

c.

No tax benefits

d.

Enjoying tax benefits that may not come from direct investing

Discuss
Answer: (d).Enjoying tax benefits that may not come from direct investing Explanation:Mutual fund investors may enjoy tax benefits that may not come to them from direct investing, particularly in debt instruments.
Q24.
What is an important consideration for mutual fund investors regarding the performance of the industry?

a.

Increasing returns

b.

Declining returns

c.

Volatility in the Capital Market

d.

Steady growth

Discuss
Answer: (c).Volatility in the Capital Market Explanation:Volatility in the capital market has slowed down the performance of the mutual fund industry, which should be an important consideration for investors.
Q25.
How are mutual funds classified according to their investment objectives?

a.

Only into equity-oriented schemes

b.

Only into debt-oriented schemes

c.

Only into income-oriented schemes

d.

Into income-oriented and growth-oriented schemes

Discuss
Answer: (d).Into income-oriented and growth-oriented schemes Explanation:Classifies mutual funds according to investment objectives into income-oriented schemes and growth-oriented schemes.
Q26.
What is the main objective of Balanced Funds?

a.

Capital appreciation only

b.

Regular income from stocks only

c.

Benefit from both capital appreciation of stocks and regular income from bonds

d.

Keep a steady allocation between equity and debt

Discuss
Answer: (c).Benefit from both capital appreciation of stocks and regular income from bonds Explanation:The objective of Balanced Funds is to benefit from both capital appreciation of stocks and regular income from bonds by keeping a steady allocation between the two asset classes.
Q27.
What is the characteristic of Sector Funds?

a.

They focus on a variety of sectors

b.

They are not affected by the performance of a specific sector

c.

They perform best when the targeted sector is performing better than the market as a whole

d.

They have a diverse portfolio across various sectors

Discuss
Answer: (c).They perform best when the targeted sector is performing better than the market as a whole Explanation:Sector Funds focus only on stocks from a certain sector, and they perform at their best when the targeted sector is performing better than the market as a whole.
Q28.
What is the investment focus of Large-cap Funds?

a.

Companies with lower market capitalization

b.

Well-established companies in the top 100 by market capitalization

c.

Stocks with high volatility

d.

Companies with higher risk and return

Discuss
Answer: (b).Well-established companies in the top 100 by market capitalization Explanation:Large-cap Funds invest in the shares of well-established companies, specifically the top 100 companies by market capitalization.
Q29.
What is the primary characteristic of Mid/Small-cap Funds?

a.

Higher market capitalization

b.

Lower market capitalization compared to large-cap companies

c.

Steady performance in the market

d.

Lower volatility than large-cap peers

Discuss
Answer: (b).Lower market capitalization compared to large-cap companies Explanation:Mid/Small-cap Funds target companies whose market capitalization is lower than that of large-cap companies.
Q30.
What is the key feature of Equity-linked Savings Scheme (ELSS)?

a.

They offer regular income

b.

They have a lock-in period of three years

c.

They invest in both equity and debt

d.

They focus on tax-benefits

Discuss
Answer: (b).They have a lock-in period of three years Explanation:ELSS is an equity fund offering tax benefits, and investments in ELSS are subject to a lock-in period of three years.
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