Mock Test 1 - TheMFCentral

NISM V-A Mock Test 1

NISM V-A (Mutual Fund Distributor Module) Exam | Mock Test 1

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1. A company whose earnings are strongly related to the state of economy is known as

Value stocks

Cyclical stocks

Growth stocks

Economy stocks

2 / 50

2. A compliance officer

stands guarantee to the information contained in the offer document

cannot certify that the AMC's legal and procedural obligations are fulfilled

cannot be appointed by the AMC

belongs to SEBI

3 / 50

3. A mutual fund owned by

The Government of India

AMFI

All its investor

SEBI

4 / 50

4. A put provision in a debt issue allows

investor to put away the certificates in safe deposit vaults

investors to extend the tenure of debt

investors to redeem debt prior to maturity

issuers to redeem debt prior to maturity

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5. 'Key Information Memorandum' is

Annual Report of the AMC

the Memorandum & Articles of Association of the AMC

a sheet containing historical NAVs of other fund schemes

an abridged version of the offer document

6 / 50

6. The amount to buy 100 units of a scheme having a entry load of 1.5% and NAV of Rs. 20 each:

Rs. 2015

Rs. 2000

Rs. 1985

Rs. 2030

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7. The NAV of each scheme should be updated on AMFI's Website

Every Day

Every Quarter

Every Month

Every Hour

8 / 50

8. The sponsor of a mutual fund may be
compared to

Promoter of a Company

the Chief Executive of a Company

a director in a Company

an equity shareholder in a Company

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9. The highest authority among the following is
the

Company Law Board

Ministry of Finance

RBI

SEBI

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10. The following need not be covered in a Key Information Memorandum

Risk Factors

Disclaimer Clause

Opening, Closing and earliest Closing Date of the offer

Functions and responsibilities of the sponsor, trustees, AMC and Custodian responsibilities

11 / 50

11. Units from an open-ended mutual fund are bought

from AMFI

on a stock exchange

from a stock broker

from the fund itself

12 / 50

12. A better performance than the return on index
is given by

non fund manager

all fund managers

an active fund manager

passive fund manager

13 / 50

13. When computing NAV of fund SEBI requires
accrual of major expenses to be accounted

on a day to day basis

when actually paid

quarterly

annually

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14. The Price/Earnings (P/E) Ratio is an important
measure of a company's anticipated
performance. It is calculated using:

Market capitalisation and dividend

Market price and face value

Market price and dividend

Market price and earning per share

15 / 50

15. A close-ended mutual fund has a fixed:

Rate of Return

NAV

Number of Distributor

Fund Size

16 / 50

16. If 10-year government securities Neil 10% and a 10-Year fixed deposit in a company yields 12%, the yield spread is

22%

10%

12%

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17. In the wholesale debt market, the largest proportion of trading is seen in

PSU Bonds

Corporate Bonds

Government Securities

T-Bills

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18. NAVs of equity funds are not affected by

Stock market movements

Events affecting the industry/sector in which the fund has invested

real estate prices

Happenings in the companies in which the fund has invested

19 / 50

19. A call provision in a debt issue allows the issuer to

extend the tenure of the debt

redeem the debt on maturity

call out the names of the investors

redeem the debt before maturity

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20. The day on which NAV is calculated by a fund is known as

computation date

book closure date

valuation date

record date

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21. It may not be possible to reinvest interest received at the same rate as principal. This is known as

call risk

reinvestment risk

inflation risk

interest-rate risk

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22. After dividend declaration, unit-holders are
entitled to receive dividend within

one month

one week

six weeks

42 days

23 / 50

23. The offer document is not a legal document

True

False

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24. Equity derivative instruments are

bonds

notes

contracts

25 / 50

25. Technical analysis guides the decision on

none of the above

whether to buy or sell

the right time to buy or sell

whether company's technical personnel are adequately qualified

26 / 50

26. The greatest potential for growth in capital is offered by

Growth funds

Debt funds

Balanced funds

Gilt funds

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27. A fixed term plan series is

An Open-ended fund

A Closed ended fund

A Fixed term Bank Deposit

A Fixed Term Corporate Bond

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28. The additional yield required to account for the risk of default by the borrower is known as

yield extra

yield premium

yield spread

yield plus

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29. Debt securities bought at a discount to their face value are generally

zero coupon bonds

interest bearing

none of the above

paying interest at a floating rate

30 / 50

30. A high turnover rate for a fund indicates

greater efficiency

high transaction costs

high returns to the investor

a rising market

31 / 50

31. The investment policies listed out in the offer
document of a fund do not include

the specific securities in which the fund will invest

policy of diversification

the type of securities in which the scheme will invest principally

asset allocation pattern

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32. An investor in a closed-ended mutual fund can get his/her money back by selling his/her units

on stock exchange where the fund is listed

back to the fund

to the agent through which he/she subscribed to units of the fund

to a special trust at NAV

33 / 50

33. The trust that manages a mutual fund is
appointed by

SEBI

RBI

The sponsor of that mutual fund

The Finance Ministry

34 / 50

34. If the NAV of an open-ended fund was Rs.16 at the beginning of the year and Rs.22 after 13 months, the annualised change in NAV is

37.5%

34.6%

40.6%

6.0%

35 / 50

35. Of the following fund types the highest risk is associated with

Equity Growth Funds

Balanced Funds

Debt Funds

Gilt Funds

36 / 50

36. The maximum load that a fund can charges determined by the

AMC

AMFI

Distribution Agents based on demand for the Fund

SEBI

37 / 50

37. A Gilt Fund is a special type of fund that invests

in short-term securities

in instruments issued by companies with a sound track record

in very high quality only

in Government Securities only

38 / 50

38. The entity that SEBI does not regulate is

non-banking finance companies

mutual funds

share registrars

stock exchanges

39 / 50

39. Issuing and redeeming units of a mutual
fund is the role

the transfer agent

the bankers

the trustees

the custodian

40 / 50

40. A funds NAV is affected by

Purchase and sale of investment securities

all of the above

valuation of all investment securities held

units sold or redeemed

41 / 50

41. The most suitable measure of fund performance for all fund types is

none of the above

Total Return

NAV Change

Total Return with reinvestment

42 / 50

42. Shares of companies with large capital market
capitalisation

are not available

have greater growth potentia

are more liquid

none of the above

43 / 50

43. An offer document contains an AMC's
investor grievance's history for the past

3 fiscal years

2 fiscal years

one fiscal year

six months

44 / 50

44. Market capitalisation of a company is
calculated by multiplying the number of
outstanding shares by

Current market value of each share

Face value of each share

Rs.10

dividend yield

45 / 50

45. Commercial Paper is issued by Corporate bodies

to finance the acquisition of long term capital assets

to pay dividend

to meet short-term working capital requirements

to retire long term debt

46 / 50

46. Are Mutual Fund agents/distributors in India
required to pass any examination to qualify to sell
Mutual Fund Units

Yes, a test conducted by SEBI

Yes, a test conducted by AMFI

a Post Graduate university course

47 / 50

47. Distribution and sales practices are only partly regulated by SEBI at present

False

True

48 / 50

48. An Open-ended mutual fund is one that has:

an option to invest in any kind of securities

units available for sale and repurchase at all times

fixed fund size

an upper limit of NAV

49 / 50

49. The custodian of a mutual fund:

does not give or receive deliveries of physical securities

need not be an entity independent of the sponsors

is appointed for safekeeping of securities

not required to be registered with SEBI

50 / 50

50. The AMC of a mutual fund cannot

undertake advisory services or financial consulting

cannot invest the funds in government paper

cannot invest the funds in securities

act as a trustee of more than one mutual fund

Your score is

The average score is 60%

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Good luck with your preparation for the NISM Series V-A exam!

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