PRE-BOARD Exam (2022-2023)

Class – XII (Level – IV) Code - 805

SUBJECT - FINANCIAL MARKETS MANAGEMENT

Time Allowed: 3 Hours Max. Marks: 60

General Instructions:
1. Please read the instructions carefully.
2. This Question Paper consists of 24 questions in two sections – Section A & Section B.
3. Section A has Objective type questions whereas Section B contains Subjective type questions.
4. Out of the given (6 + 18 =) 24 questions, a candidate has to answer (6 + 11 =) 17 questions in the allotted
(maximum) time of 3 hours.
5. All questions of a particular section must be attempted in the correct order.
6. SECTION A - OBJECTIVE TYPE QUESTIONS (30 MARKS):
i. This section has 06 questions. ii. There is no negative marking.
iii. Do as per the instructions given. Iv. Marks allotted are mentioned against each question/part.
7. SECTION B – SUBJECTIVE TYPE QUESTIONS (30 MARKS):
i. This section contains 18 questions. ii. A candidate has to do 11 questions.
iii. Do as per the instructions given. Iv. Marks allotted are mentioned against each question/part.

SECTION A: OBJECTIVE TYPE QUESTIONS

Q. 1 Answer any 4 out of the given 6 questions on Employability Skills (1 x 4 = 4 marks)

i. Ravi has feelings of emptiness, abandonment and suicide. What type of personality 1
disorder is this?
a) Borderline b) Dependent
c) Avoidant d) Obsessive
ii. It arises because of incentives or external rewards. 1
a) Intrinsic motivation b) Extrinsic motivation
c) Both a & b d) None of the above
iii. Which of the following sign define formula? 1
a) + b) -
c) = d) /
iv. The ability to continue to do something, even when it is difficult is called _____. 1
a) Initiative b) Organisational Skills
c) Perseverance d) None of the above
v. What are the qualities that motivate an entrepreneur? 1
a) Uniqueness b) Focus on long term goals
c) Standard of excellence d) All of the above
vi. What is the shortcut key to paste text in spreadsheets? 1
a) Ctrl + V b) Ctrl + C
c) Ctrl + U d) Ctrl + P

Q. 2 Answer any 5 out of the given 7 questions (1 x 5 = 5 marks)

i. The _________refers to the market where securities are traded after being offered 1
to the public in the primary market?
a) Primary Market b) Secondary Market
c) Both a & b d) None of the above
ii. __________is used as a measure of trading activity or liquidity in the stock market? 1
a) Market Capitalisation b) Market Capitalisation Ratio
c) Turnover d) Turnover Ratio
iii. Which of these is/are a Market Participant(s)? 1
a) Investors b) Issuers
c) Intermediaries d) All of the above
iv. Which of the following grounds are on basis of which there can be suspension or 1
expulsion of trading membership?
a) Misconduct b) Un-business-like conduct
c) Unprofessional conduct d) All of the above
 v. The expulsion of a trading member has which of the following consequences? 1
a) Trading membership rights forfeited b) Fulfillment of contracts
c) Rights of creditors unimpaired d) All of the above

vi. SEBI grants a certificate to a stock broker subject to the conditions that the stock 1
broker _____
a) Should pay the amount of fees for registration in the prescribed manner
b) Holds the membership of any stock exchange
c) Both a & b d) None of the above
vii. The trading members of NSE have certain benefits, which include(s) _______? 1
a) Ability to provide a fair, efficient and transparent securities market to the investors
b) access to a nation-wide trading facility for equities, derivatives, debt & hybrid
instruments/ products
c) use of state of the art electronic trading system and technology
d) all of the above

Q. 3 Answer any 6 out of the given 7 questions (1 x 6 = 6 marks)

i. are users at the lowest level of the hierarchy. 1
a. Corporate Manager b. Branch Manager
c. City Manager d. Dealer
ii. Which one is not the participant of Auction market? 1
a) Initiator b) Competitor
c) Solicitor d) Care taker

iii. The ___________is a feature available in the system to get instantaneous market 1
information.
a) Activity Log b) Market movement
c) Snap Quote d) None of the above
iv. VSAT stands for 1
a) Very Small Aperture Terminal b) Very Small Aperture Trunk
c) Very Small Aero Terminal d) Very Senior Aperture Terminal

v. In which market phase, the system processes the data for making the system 1
available for the next trading day?
a) Opening b) Market Close
c) SURCON d) Post-Close Market
vi. The Special feature of Activity Log is that gives details of all activities in 1
_____orders.
a)Chronological orders b) Reverse Chronological orders
c) Both a & b d) None of the above

vii. In Online Backup facility, utility generates two ASCII files namely ______. 1
a)Order.pdf & Trade.pdf b) Order.jpg & Trade.jpg
c) Order.xlsx & Trade.xlsx d) Order.txt & Trade.txt

Q. 4 Answer any 6 out of the given 7 questions (1 x 6 = 6 marks)

i. __________ is the National Numbering Agency in India. 1
a) NSDL b) RBI
c) SEBI d) NSE
ii. _________ form a key part of the risk management system? 1
a) Margins b) Securities
c) Depositories d) None of the above
iii. ___ arises when failure of one of the parties to discharge his obligation leads to 1
failure by other parties.
a) Operational Risk b) Legal Risk
c) Systemic Risk d) None of the above
 iv. _______ it means the volatility of the security computed as at the end of the 1
previous trading day.
a) Index Sigma b) Security Sigma
c) Security VaR d) Index VaR

v. An off-setting position for a client in different segments has lower risk as loss on one 1
position is off-set by profit in the other position.
a) Cross Margining b) Capping of Margin
c) Extreme loss Margin d) Mark to Market Margin

vi. _____means a person whose name is recorded as such with a depository. 1

a) Registered Owner b) Beneficial Owner
c) Temporary Owner d) None of the above
vii At NSE, trades in rolling settlement are settled on the ______? 1
a) 7th working day b) 5th working day
c) 2nd working day d) Last working day

Q. 5 Answer any 5 out of the given 6 questions (1 x 5 = 5 marks)

i. At 6% annual inflation rate, an item costing Rs. 100 today, would cost Rs. ________ 1
after 3 years.
a) 100 b) 82
c) 118 d) 119.10
ii. It is assumed that every year the worth of an asset falls due to usage. This 1
reduction in value is called ___________.
a) Net Block b) Depreciation
c) Gross Block d) Fixed asset

iii. Reflects relative contributions of creditors and owners to finance the business. 1
a) Current Ratio b) Gross Profit Ratio
c) Debt-Equity Ratio d) Inventory Turnover Ratio

iv. These assets are acquired for long-terms and are used for business operation, but 1
not meant for resale.
a) Fixed Assets b) Investments
c) Current Assets d) None of the above
v. Which one is not the right of Preferential shareholders? 1
a) Right to get payment of dividend at a fixed rate during the life
b) Return of capital on winding up of the company
c) Have voting rights
d) None of the above
vi. These derivatives comprises of an assured occurrence in the future. Which is it? 1
a) Forwards b) Forwards Commitment
c) Contingent Claim d) Futures

Q. 6 Answer any 4 out of the given 5 questions (1 x 4 = 4 marks)

i. It gives the holder the right but not the obligation to sell an asset by a certain date 1
for a certain price?
a) Holder of an Option b) Stock Option
c) Call Option d) Put Option
ii. ________ measures the sensitivity of stocks responsiveness to market factors? 1
a)Futures b) Pricing
c) Beta d) None of the above
iii. ________ is defined as the futures price minus the spot price? 1
a) Long Position b) short position
c) Contract cycle d) Basis
 iv. _______does not require margin payment. 1
a) Option Contracts b) Future Contracts
c)Forward Contracts d) None of the above

v. An ________ option would lead to a positive cash flow to the holder if it were 1
exercised immediately.
a) At-the-money Option b) In-the-money Option
c) Out-of-money Option d) None of the above

SECTION B: SUBJECTIVE TYPE QUESTIONS

Answer any 3 out of the given 5 questions on Employability Skills (2 x 3 = 6 marks) Answer each question
in 20 – 30 words.

Q. 7 How to become result oriented? 2

Q. 8 What are the advantages of presentation software? Write one name of presentation 2
software.
Q. 9 What do you understand by attitude? 2
Q. 10 How to overcome personality disorders? 2
Q. 11 What is entrepreneurship? Write one name of entrepreneur who become popular in your 2
nearby area.

Answer any 3 out of the given 5 questions in 20 – 30 words each (2 x 3 = 6 marks)

Q. 12 What are the Trading System Users’ Hierarchy. 2
Q. 13 What is Settlement Guarantee Mechanism of the Exchange? 2
Q. 14 How to go about systematically analyzing a company? 2
Q. 15 What are the desirable attributes of an Index? 2
Q. 16 What are the limitations of Forward Markets? 2

Answer any 2 out of the given 3 questions in 30– 50 words each (3 x 2 = 6 marks)
Q. 17 What are the different Market Segments and their products of NSE? 3

Q. 18 What is Market by Price and what are the special features of MBP? 3
Q. 19 What are the problems pertaining to Securities Settlement? 3

Answer any 3 out of the given 5 questions in 50– 80 words each (4 x 3 = 12 marks)
Q. 20 One such risk containment tool is the concept of ‘Dominant Promoter/ Shareholder Group’ 4
which is very unique for applicants acquiring membership on the NSE. Explain about
Corporate Structure (Shareholding Pattern).

Q. 21 Explain about trader workstation NEAT SCREEN. 4

Q. 22 How are the Securities identified through International Securities Identification Number? 4
Explain.

Q. 23 What are the types of Derivatives Contracts? Explain on different basis. 4

Q. 24 1- Payoff Profile for Buyer of Call Options: Long Call. 4

2- Payoff Profile for Seller/ Writer of Call Options: Short Call.
Explain separately with graph/ diagram.