# NTS/NTS CURRENT AFFAIRS FINANCE MCQ SET 3 Sample Test,Sample questions

## Question: `A companys agreement with the underwriter include`

1.spread

2.greenshoe option

3.A and B

4.whiteshoe option

Posted Date:-2021-08-18 06:57:25

## Question: `A four year zero-coupon bond has 6% yield. What is its duration in years?`

1.4

2.5

3.6

4.7

Posted Date:-2021-08-18 06:57:25

## Question: `Allocating stock in popular new issues to manager of their important corporate clients is called`

1.subscription

2.under-performance

3.rights

4.spinning

Posted Date:-2021-08-18 06:57:25

## Question: `An agreement on a telephone or email to buy/sell an asset at an agreed future time for an agreed price is called`

1.spot contract

2.forward contract

3.future contract

4.swap

Posted Date:-2021-08-18 06:57:25

## Question: `An investment of \$9,000 today will yield \$10,000 after one year. What is the Net Present Value if the interest rate is 10%?`

1.\$71

2.\$81

3.\$91

4.\$101

Posted Date:-2021-08-18 06:57:25

## Question: `An option that allows the underwriter to increase the number of shares bought by 15% is called`

1.spread

2.spinning

3.whiteshoe

4.greenshoe

Posted Date:-2021-08-18 06:57:25

## Question: `Changes in interest rates have a __________ impact on the prices of long-term bonds than the short-term bonds.`

1.greater

2.smaller

3.both have same impact

4.interest rate does not matter

Posted Date:-2021-08-18 06:57:25

## Question: `Difference between strike price and stock price is called`

1.intrinsic value

2.option premium

3.time premium

4.none of these

Posted Date:-2021-08-18 06:57:25

## Question: `If a random variable X has a normal distribution, then X has a/an _____ distribution.`

1.lognormal

2.exponential

3.Poisson

4.binomial

Posted Date:-2021-08-18 06:57:25

## Question: `If an experiment is repeated independently for a large number of times, it converges to a/an`

1.expected value

2.variance mean

3.normal distribution

4.uniform distribution

Posted Date:-2021-08-18 06:57:25

## Question: `If market price of the share at expiration is \$100 and exercise price is \$80, then value of a call option at expiration is`

1.\$20

2.\$0

3.\$1

4.\$20

Posted Date:-2021-08-18 06:57:25

## Question: `If market price of the share at expiration is \$100 and exercise price is \$80, then value of a put option at expiration is`

1.\$20

2.\$0

3.\$1

4.\$20

Posted Date:-2021-08-18 06:57:25

## Question: `If the co-variance between stock A and market returns is 12, and the standard deviation of market returns is 3 then what is the value of beta?`

1.0.96

2.1

3.1.33

4.1.45

Posted Date:-2021-08-18 06:57:25

## Question: `If the distribution is symmetric about mean then the skewness is`

1.0

2.1

3.positive

4.negative

Posted Date:-2021-08-18 06:57:25

## Question: `If the spot price is \$1200 and the exercise price is \$1000 then the payoff of a party assuming a long position is`

1.-\$200

2.\$0

3.\$1

4.\$200

Posted Date:-2021-08-18 06:57:25

## Question: `If the spot price is \$1200 and the exercise price is \$1000 then the payoff of a party assuming a short position is`

1.\$200

2.\$0

3.\$1

4.\$200

Posted Date:-2021-08-18 06:57:25

## Question: `In a module, quiz contributes 10%, assignment 30%, and final exam contributes 60% towards the final result. A student obtained 80% marks in quiz, 65% in assignment, and 75% in the final exam. What are average marks?`

1.64.50%

2.68.50%

3.72.50%

4.76.50%

Posted Date:-2021-08-18 06:57:25

## Question: `On 1 January you enter a contract to buy 1 million barrel of oil for \$80 per barrel to be delivered on 1 March. The price on 1 March is \$82 per barrel. Your gain is`

1.\$200

2.\$20000

3.\$200000

4.\$2000000

Posted Date:-2021-08-18 06:57:25

## Question: `Rolling of a die is an example of a random`

1.event

2.outcome

3.experiment

4.sample space

Posted Date:-2021-08-18 06:57:25

## Question: `Spread is __________ for IPOs.`

1.highest

2.lowest

3.average

4.uncertain

Posted Date:-2021-08-18 06:57:25

## Question: `The arithmetic mean of all possible outcomes is known as`

1.expected value

2.critical value

3.variance

4.standard deviation

Posted Date:-2021-08-18 06:57:25

## Question: `The error of rejecting the null hypothesis when it is true is known as`

1.Type-I error

2.Type-II error

3.Type-III error

4.Type-IV error

Posted Date:-2021-08-18 06:57:25

## Question: `The interest rate earned if a financial asset is held until its maturity is called`

1.term structure

2.spinning

3.yield

4.spread

Posted Date:-2021-08-18 06:57:25

## Question: `The long-run returns of Initial Public Offerings (IPOs) tend to __________ the market.`

1.underperform

2.accelerate

3.amplify

4.none of these

Posted Date:-2021-08-18 06:57:25

## Question: `The mean and variance of Poisson distribution are both`

1.0

2.1

3.?

4.1/?

Posted Date:-2021-08-18 06:57:25

## Question: `The mean and variance of standard normal distribution is _____ and _____ respectively`

1.0, 1

2.1, 0

3.ï¿½1, 1

4.ï¿½ï¿½?,ï¿½?

Posted Date:-2021-08-18 06:57:25

## Question: `The mean, mode, and median of the data set: 5, 4, 10, 12, 1, 5, 3, 7, 15, and 8 is respectively`

1.ï¿½5, 6, 7

2.7, 6, 5

3.6, 5, 7

4.7, 5, 6

Posted Date:-2021-08-18 06:57:25

## Question: `The party that agrees to buy the underlying asset in a forward contract is said to assumes`

1.forward position

2.backward position

3.long position

4.short position

Posted Date:-2021-08-18 06:57:25

## Question: `The party that agrees to sell the underlying asset in a forward contract is said to assumes`

1.forward position

2.backward position

3.long position

4.short position

Posted Date:-2021-08-18 06:57:25

## Question: `The price of a stock is \$100, and it could be \$95 or \$115 the next year. What is the expected return?`

1.5%

2.6%

3.7%

4.7.50%

Posted Date:-2021-08-18 06:57:25

## Question: `The price of a stock is \$100, and there are 40% chances that it would be \$95 and 60% chances that it would be \$115 the next year. What is the expected return?`

1.5%

2.6%

3.7%

4.7.50%

Posted Date:-2021-08-18 06:57:25

## Question: `The return that is forgone by investing in the project rather than investing in financial markets at the same level of risk is called`

1.internal rate of return

2.capital saving

3.opportunity cost

4.opportunity saving

Posted Date:-2021-08-18 06:57:25

## Question: `The value of a financial derivative depends on the`

1.maturity

2.duration

3.forward interest rate

4.underlying

Posted Date:-2021-08-18 06:57:25

## Question: `The value of R2, the coefficient of determination, is always between`

1.0 and 1, including 0 and 1

2.0 and 1, excluding 0 and 1

3.ï¿½1ï¿½and 1, includingï¿½ï¿½1 and 1

4.ï¿½1ï¿½and 1, excludingï¿½ï¿½1 and 1

Posted Date:-2021-08-18 06:57:25

## Question: `Var (X + Y) = ?`

1.E[X/Y] + E[Y]

2.E[Y/X] + E[X]

3.Var(X) + Var(Y) + 2 Cov(X, Y)

4.Var(X) + Var(Y) - 2 Cov(X, Y)

Posted Date:-2021-08-18 06:57:25

## Question: `Var (X) = ?`

1.E[X2]

2.E[X2] E[X]

3.E[X2] + E[X]2

4.E[X2] - E[X]2

Posted Date:-2021-08-18 06:57:25

## Question: `What is the arithmetic mean of the data set: 4, 5, 0, 10, 8, and 3?`

1.4

2.5

3.6

4.7

Posted Date:-2021-08-18 06:57:25

## Question: `What is the average of 3%, 7%, 10%, and 16% ?`

1.8%

2.9%

3.10%

4.11%

Posted Date:-2021-08-18 06:57:25

## Question: `What is the average of the data set: 3, 4, 5, 0, 8, and 10?`

1.4

2.5

3.6

4.7

Posted Date:-2021-08-18 06:57:25

## Question: `What is the geometric mean of: 1, 2, 8, and 16?`

1.4

2.5

3.6

4.7

Posted Date:-2021-08-18 06:57:25

## Question: `What is variance of the data set: 2, 10, 1, 9, and 3?`

1.15.5

2.17.5

3.5.5

4.7.5

Posted Date:-2021-08-18 06:57:25

## Question: `When forward contract is traded on an exchange, it is called`

1.spot contract

2.future contract

3.call option

4.put option

Posted Date:-2021-08-18 06:57:25

## Question: `Which from the following issues has the lowest total direct cost?`

1.straight bonds

2.corporate stocks

3.all issues have same cost

4.none of these

Posted Date:-2021-08-18 06:57:25

## Question: `Which from the following statements is incorrect?`

1.A European option can only be exercised at expiry

2.An American option can only be exercised at expiry

3.A European option is a right but not obligation

4.An American option is a right but not obligation

Posted Date:-2021-08-18 06:57:25

## Question: `Which measure is used to determine whether the distribution is heavy-tailed or light-tailed?`

1.skewness

2.kurtosis

3.variance

4.standard deviation

Posted Date:-2021-08-18 06:57:25

## Question: `Which of the following cannot be the probability of an event?`

1.0

2.0.3

3.0.9

4.1.2

Posted Date:-2021-08-18 06:57:25

## Question: `Which of the following cannot be the value of a correlation coefficient?`

1.1

2.0.75

3.0

4.1.2

Posted Date:-2021-08-18 06:57:25

## Question: `Which probability distribution is used to model the time elapsed between events?`

1.Exponential

2.Poisson

3.Normal

4.Gamma

Posted Date:-2021-08-18 06:57:25

## Question: `Which statistical method is used to estimate the relationship between two variables?`

1.Correlation

2.Regression

3.Covariance

4.ANOVA

Posted Date:-2021-08-18 06:57:25

## Question: `Which test is applied to Analysis of Variance (ANOVA)?`

1.t test

2.z test

3.F test

4.2 test

Posted Date:-2021-08-18 06:57:25

## More MCQS

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