Association of Mutual Funds in India (AMFI) 2008 AMFI Mutual Fund Basic Module Model Mock Test N - Question Paper
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b. False
46.In financial planning, all responsibility ends with the financial planner and the client has no responsibilities
a. True
b. False
47.The constraint on financial planning due to insufficient investable resources can be remedied to a few extent by
a. Decreasing the standard of residing
b. Disciplining children
c. Disciplined monthly budgeting
d. None of the above
48.In the growth choice offered by mutual funds, the number of units held by an investor increases because of
a. Growth in net asset value i.e. Capital appreciation
b. Reinvestment of dividend, which is, like compounding
c. Interest received on the fund's assets
d. None of the above
49.To maximise returns on investment, once an investor buys into a fund, he/she should hold on to it no matter what happens
a. True
b. False
50.If an investor keeps investing a fixed amount at regular intervals, the avg. cost of his purchases will always be less than if he makes investment at irregular periods
a. True
b. False
51.Which of the subsequent lets an investor book profits in rising market and increase holdings in a falling market
a. Fixed Rates of Asset Allocation
b. Flexible Ratio of Asset Allocation
c. Investment without any asset allocation plan
d. Buy and hold Strategy
52.A Flexible Ratio of Asset Allocation means
a. Continuously changing the ratio of different assets in the portfolio
b. Not doing any re-balancing and letting the profits run
c. Active switching
d. None of the above
53.The strategy advisable for an investor to maximise investment return in the long run is
a. Buy and hold on to investments for a long time
b. Liquidate poorly performing investments from time to time
c. Liquidate good performing investments from time to time
d. Switch from poor performers to good performers
54.A criticism of rupee-cost averaging is
a. Investment is for the identical amount at regular intervals
b. Over a period of time, the avg. purchase price will work out higher than if 1 tries to guess the market highs and lows
c. It does not tell you when to buy, sell or switch from 1 scheme to a different
d. Rupee cost averaging has no serious shortcomings
55.In India, individual investors do not have direct access to
a. Capital market instruments
b. Real estate
c. Bullion
d. Money market instruments
56.Which of the subsequent entities can provide loans against securities
a. UTI
b. Banks
c. Mutual Funds
d. None of the above
57.Which of the subsequent investment products do not provide guarantee for return or capital
a. Bank deposits
b. Public Provident Fund (PPF)
c. National Savings Certificates (NSC)
d. Units of a mutual fund
58.The biggest advantage of investment in gold is
a. High returns
b. High appreciation in value
c. Low Purchase price
d. Hedge against inflation
59.The biggest disadvantage of investment in real estate is
a. Less potential for capital appreciation
b. High purchase price
c. Depreciation in value as time passes
d. Value gets eroded due to inflation
60.Which of the subsequent is not an advantage of bank deposits ?
a. Liquidity
b. High perceived safety
c. Low entry price
d. High yield after tax
61.Listing of shares at a stock exchange ensures
a. Guaranteed returns
b. Long term capital appreciation
c. Low risk
d. High liquidity
62.The rate of interest paid by a company on debentures issued by it depends on
a. The stock market situation
b. SEBI guidelines
c. The company's credit rating
d. The amount of money being raised
63.Which of the subsequent is not a characteristic of company fixed deposits
a. A higher rate of interest
b. Higher risk
c. Unfavourable effect of tax
d. Very high liquidity
64.Which of the subsequent is untrue for Public Provident Fund Schemes
a. The interest is tax-free
b. Post-tax returns are attractive
c. Liquidity is rather low
d. None of the above
65.Indira Vikas Patra is an investment product popular with
a. Rural investors
b. Investors in high tax bracket
c. Urban investors
d. Risk taking investors
66.Finance Acts of 2000 and 2001 have decreased tax-free interest on Public Provident Fund to
a. 12%
b. 9.5%
c. 9%
d. 11%
67.Most individuals invest in life insurance policies for
a. Risk protection
b. Tax benefits
c. Easy liquidity
d. High returns
68.Annual contribution to Public Provident Fund should be
a. Rs.10000.00
b. Between 100 and Rs.60000
c. Between Rs.600 and Rs.1000
d. None of the above
69.The current yield (2000-01) on Indira Vikas Patra works out to
a. 10.5%
b. 11%
c. 10%
d. 9%
Earning: Approval pending. |