Accounting and Finance problems
- 1. In a fractional reserve banking system
Options- A. bank accepts deposits
- B. bank accepts some loans
- C. bank has some cash reserves
- D. All the above Also asked in: Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: All the above
Explanation:
Fractional reserve banking is the practice whereby a bank accepts deposits, makes loans or investments, but is required to hold reserves equal to only a fraction of its deposit liabilities. Fractional reserve banking is a banking system in which only a fraction of bank deposits are backed by actual cash on hand and are available for withdrawal. This is done to expand the economy by freeing up capital that can be loaned out to other parties.
- 2. Compounding interest means interest accrues
Options- A. at variable rates throughout the term
- B. more quickly than simple interest
- C. more slowly than simple interest
- D. at the same rate as simple interest Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: more quickly than simple interest
- 3. Which investment type typically carries the least risk?
Options- A. Mutual funds
- B. Treasury bonds
- C. Savings account
- D. Individual stocks Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: Savings account
Explanation:
Different types of risk exist in ivesting schemes depending on what you've invested in.
Savings accounts are generally regarded as the least risky investments as in this we just save our wealth for future expenses.
- 4. The credit balance in the bank account is
Options- A. amount liable to pay by bank
- B. amount liable to pay by customer
- C. Both A + B
- D. None of the above Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: amount liable to pay by bank
Explanation:
Bank credit balance meant that the banker is laible to paid us.
And if we have a credit balance accouding to bank statement is mean we have " cash at bank" and in our book we show in the assets side but bank show laiblities side.
Hence, The credit balance in the bank account is the amiunt we have in our account and we are eligible to withdraw that.
- 5. Most financial investments are examples of what type of risk?
Options- A. Credit risk
- B. Longevity risk
- C. Human risk
- D. Inflation risk Also asked in: AIEEE, Bank Exams, CAT, GATE, Analyst, Bank Clerk, Bank PO
Correct Answer: Human risk
Explanation:
Most financial investments are examples of Human risk type of risks. Since, we humans invest in any kind of financial investments on our own risk expecting profits.
- 6. The interest-rate effect suggests that
Options- A. an increase in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending.
- B. a decrease in the supply of money will increase interest rates and reduce interest-sensitive consumption and investment spending
- C. an increase in the price level will decrease the demand for money, reduce interest rates, and increase consumption and investment spending.
- D. an increase in the price level will increase the demand for money, reduce interest rates, and decrease consumption and investment spending. Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: an increase in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending.
- 7. An increase in the price of product A will
Options- A. reduce the demand for resources used in the production of A.
- B. reduce the demand for substitute product B
- C. increase the demand for complementary product C.
- D. increase the demand for substitute product B. Also asked in: AIEEE, Bank Exams, CAT, GATE, Analyst, Bank Clerk, Bank PO
Correct Answer: increase the demand for substitute product B.
Explanation:
If the price of a product rises, the demand for the substitute product increases.
- 8. Which of the following best describes Accounting?
Options- A. is an information system that provides reports to its stakeholders regarding economic activities and the condition of the business
- B. is used only for filling out tax returns and for financial statements for various types of governmental reporting requirements
- C. records economic data but does not communicate the data to users according to any specific rules
- D. is of no use by individuals outside of the business Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: is an information system that provides reports to its stakeholders regarding economic activities and the condition of the business
- 9. The accounting process is correctly sequenced as
Options- A. Identifying?recording?communicating
- B. Identifying?communicating?recording
- C. Communicating?Recording?Identifying
- D. Recording?Communicating?Identifying Also asked in: AIEEE, Bank Exams, CAT, GATE, Analyst, Bank Clerk, Bank PO
Correct Answer: Identifying?recording?communicating
- 10. Which of the following can increase your credit card?s APR?
Options- A. making credit card payments
- B. missing credit card payments
- C. not using credit card for long time
- D. All of the above Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: missing credit card payments
Explanation:
APR means Annual Percentage Rate. Creditcards apr can be increased when you missed credit card payments.
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