Association of Mutual Funds in India (AMFI) 2008 AMFI Mutual Fund Basic Module Mock Model Test - Question Paper

b. Compare the fund with other mutual funds
c. Assure a rate of return
d. Compare the fund with other financial products

49. Which of the subsequent is not a characteristic of company fixed deposit?
a. A higher rate of interest
b. Higher risk
c. Unfavorable effect of tax
d. Very high liquidity

50. Which of the subsequent represent indirect investments?
a. Investment in a mutual fund
b. Investment in shares
c. Investment in bank deposit
d. Investment in post office schemes

51. The most important cause for an investor to prefer a bank deposit to a mutual fund is
a. The creditworthiness of the bank
b. Because the bank does not invest in securities
c. That the bank offers a guarantee
d. All of the above


52. The constraint on financial planning due to insufficient 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

53. Structural characterization of an equity fund include
a. Costs of investing
b. The specific securities in which the fund has invested
c. The number of employees of the AMC
d. All of the above

54. Listing of shares at a stock exchange ensures
a. Guaranteed returns
b. Long term capital appreciation
c. Low risk
d. High liquidity

55. Mutual fund investors should be advised to expect
a. Low post tax returns
b. Dramatic outcomes
c. Better returns than every other available choice
d. Only realistic wealth accumulation goals

56. Once a financial advisor works out ideal Asset Allocation, it can be used for all his investors
a. True
b. False

57. A retired person generally needs a greater proportion
a. Debt funds
b. Equity funds
c. Money Market funds
d. All of the above

58. A fund with a high beta coefficient provide greater returns in a rising market, and is more risky in a falling market
a. True
b. False

59. In which kind of schemes should an unmarried professional working in HLL invest
a. Scheme investing 80% in debt securities
b. 50% in equity funds and 50% in income funds
c. At lowest 75% in equity funds having a higher P/E Ratio than the market
d. All the money in a balanced fund

60. The best equity fund, relative to others, would have
a. Higher Ex Marks, lower Beta and higher Gross Dividend Yield
b. Higher Ex Marks, higher Beta and higher Gross Dividend Yield
c. Lower Ex Marks, lower Beta and lower Gross Dividend Yield
d. Lower Ex Marks, higher Beta and higher Gross Dividend Yield


61. An investor wishes to switch ranging from a money market mutual fund and an equity fund. What would you advise him?
a. It would be better to stick to 1 kind of fund, the 1 that meets his investment objective
b. He should keep switching parts of his investment from the equity fund to the money market fund as the market rises & switch back to the equity fund when the market falls
c. He should switch from the money market fund to the equity fund in a rising market and switch back to money market fund when the market falls
d. None of the above

62. If a charitable trust approaches a distributor for investment in MF, the distributor should
a. Accept the application without wasting time
b. Reject the application outright
c. Refer to the offer document
d. Accept the application as a direct application

63. Beta of an equity fund measures its
a. Performance
b. Risk
c. Both the above
d. None of the above

64. The basis of genuine investment advice should be
a. The current market situation
b. The agent commissions paid by various funds
c. Financial planning to suit the investor's needs
d. Planning to complete the agent's annual targets

65. 1 of your friends who have invested in a mutual fund is about to get Australian citizenship. What would you advise?
a. He should transfer the investment to his relative
b. He should get RBI approval for continuing
c. He can continue on to hold as PIO are allowed to invest in mutual funds in India
d. He should immediately redeem his investment since foreign citizens are not eligible investors

66. As per Boggle, asset allocation for older investors in accumulation phase should be
a. 30% equity; 70% debt
b. 40% equity; 60% debt
c. 50% equity; 50% debt
d. 70% equity; 30% debt

67. A steady holding of investments in an equity fund's portfolio shows
a. Long-term orientation
b. Lower transaction costs
c. Both the above
d. None of the above

68. An investor should not invest in a mutual fund if
a. He expects a customized portfolio
b. He is able to carry out detailed investment research and monitor the stock market
c. Both the above
d. None of the above
69. Which of the subsequent is not actual about the buy and hold strategy
a. It is preferred by a many investors
b. It does not involve rebalancing
c. It is very beneficial as investors may exit from poor performers and invest in better ones
d. All of the above

70. The highest risk is associated with 1 of the subsequent type of funds
a. Balanced Funds
b. Gilt Funds
c. Equity Growth Funds
d. Debt Funds

71. The least risk exists in which of the following?
a. Gilt funds
b. Diversified debt fund
c. Liquid fund
d. Conservative bond fund

72. Which of the subsequent is not false about a mutual fund?
a. Open ended funds can be sold in secondary market
b. Closed ended fund do not have a fixed tenure
c. Open ended funds do not compute their NAV on every business day
d. The NAV of a closed ended fund has to be computed at lowest once in a week

73. Which of the subsequent investment is not made by debt funds?
a. Government debt instruments
b. Corporate paper
c. Financial institutions' bonds
d. Equity of private companies

74. Which of the subsequent is not actual for a mutual fund?
a. The mutual fund is owned by all the investors
b. Mutual fund provide a diversified portfolio to investors
c. The objectives of investors of a mutual fund are diverse
d. The mutual funds do not invest in real estate

75. The amount needed to buy 100 units of a scheme having an entry load of 1.5% and NAV of Rs.20 is
a. Rs.2000
b. Rs.2015
c. Rs.1985
d. Rs.2030

Earning:   Approval pending.