AAFM GLO_CWM_LVL_1 Quiz 1 Topic 5 Questions 1-5

Question: 1

A borrower defaults on a secured loan of Rs. 50,000. The underlying security is worth Rs. 60,000. Which of the following is true? "

A'Bank can retain Rs. 50,000. Balance Rs. 10,000 has to be paid to the borrower.'

BBank cannot sell the underlying security because its value is higher than loan.

C'Bank can retain the entire Rs. 60,000'

D'The excess of Rs. 10,000 has to be shared equally between the bank and the borrower.'

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Question: 2

Suppose there is Portfolio ''P'' available for investment in the market which has a correlation with the market of 0.70.

What portion of the risk of the portfolio can be eliminated through diversification?

A49%

B30%

C70%

D51%

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Question: 3

"A borrower who has been given notice of enforcement of security interest, replies with his objections. What is expected of the secured creditor? "

AConsider the objections fairly

B'If objections not acceptable, convey to borrower within 7 days'

CBoth of the above

DNone of the above

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Question: 4

"When a customer opts for a safe deposit locker, the bank becomes a _______."

ADebtor

BCreditor

CLessee

DLessor

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Question: 5

Mr. Pradip completed construction of a residential house on 1.4.2011.

Interest paid on loans borrowed for purpose of construction during the 2 years prior to completion was Rs. 40,000. The house was let-out on a monthly rent of Rs. 4,000.

q5_GLO_CWM_LVL_1

Property was vacant for 3 months.

Compute the income under the head ''Income from House Property'' for the A.Y. 2012-13.

ARs 1000

B1500

C5000

D3500

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AAFM GLO_CWM_LVL_1 Quiz:1 Topic:5 Questions:1-5