Banking Awareness Quiz – Set 156

Hello Aspirants,
Welcome to Banking Awareness Quiz in AffairsCloud.com. Here we are creating quiz covering important questions which are common for all the bank exams and other competitive exams.

1. An Indian Company can receive foreign investment by issue of Equity shares issued in accordance with the provisions of the _______
   A. Companies Act, 2013
   B. RBI Act 1934
   C. Foreign Exchange Management Act, 1999
   D. All of these
   E. None of these
   
   Answer & Explanation

   A. Companies Act, 2013
   Explanation:
   An Indian Company can receive foreign investment by issue of Equity shares issued in accordance with the provisions of the Companies Act, 2013
   
   
2. Who among the following can invest in a convertible Note?
   A. Citizen of Pakistan
   B. Citizen of Bangladesh
   C. Citizen of Nepal
   D. All of these
   E. None of these
   
   Answer & Explanation

   C. Citizen of Nepal
   Explanation:
   A person resident outside India (other than an individual who is citizen of Pakistan or Bangladesh or an entity which is registered/ incorporated in Pakistan or Bangladesh), may purchase convertible notes issued by an Indian start-up company.
   
   
3. Foreign investment is prohibited in _________
   A. Chit funds
   B. Nidhi company
   C. Trading in Transferable Development Rights (TDRs)
   D. Lottery Business
   E. All of these
   
   Answer & Explanation

   E. All of these
   Explanation:
   Lottery Business including Government / private lottery, online lotteries, etc.
   Gambling and Betting including casinos etc.
   Chit funds
   Nidhi company
   Trading in Transferable Development Rights (TDRs)
   Real Estate Business
   Manufacturing of tobacco or of tobacco substitutes
   Activities / sectors not open to private sector investment- Atomic energy and Railway operations.
   
   
4. The term ‘transfer’ is defined under _______
   A. Companies Act, 2013
   B. RBI Act 1934
   C. Foreign Exchange Management Act, 1999
   D. All of these
   E. None of these
   
   Answer & Explanation

   C. Foreign Exchange Management Act, 1999
   Explanation:
   The term ‘transfer’ is defined under FEMA, 1999 as “sale, purchase, acquisition, mortgage, pledge, gift, loan or any other form of transfer of right, possession or lien.
   
   
5. Convertible notes issued by an Indian start-up company for an amount of _______
   A. Rs. 5 lakh
   B. Rs. 15 lakh
   C. Rs. 25 lakh
   D. Rs. 20 lakh
   E. All of these
   
   Answer & Explanation

   C. Rs. 25 lakh
   Explanation:
   Convertible notes issued by an Indian start-up company for an amount of twenty five lakh rupees.
   
   
6. Which of the following is an instrument issued by a start-up company?
   A. Commercial Paper
   B. Certificate of Deposit
   C. Bond
   D. Convertible Note
   E. None of these
   
   Answer & Explanation

   D. Convertible Note
   Explanation:
   Convertible Note is an instrument issued by a start-up company.
   
   
7. Tenor of convertible instruments will be guided by the instructions framed under the _______
   A. Companies Act, 2013
   B. RBI Act 1934
   C. Foreign Exchange Management Act, 1999
   D. All of these
   E. None of these
   
   Answer & Explanation

   A. Companies Act, 2013
   Explanation:
   Tenor of convertible instruments will be guided by the instructions framed under the Companies Act, 2013.
   
   
8. Who can purchase or sell FDI compliant instruments of Indian companies on the Stock Exchanges under the Portfolio Investment Scheme?
   A. PIO
   B. NRE
   C. NRI
   D. All of these
   E. None of these
   
   Answer & Explanation

   C. NRI
   Explanation:
   NRI can purchase or sell FDI compliant instruments of Indian companies on the Stock Exchanges under the Portfolio Investment Scheme.
   
   
9. An NRI can purchase shares up to ____ per cent of the paid up capital of an Indian company on a fully diluted basis.
   A. 4%
   B. 5%
   C. 6%
   D. 7%
   E. None of these
   
   Answer & Explanation

   B. 5%
   Explanation:
   An NRI can purchase shares up to 5 per cent of the paid up capital of an Indian company on a fully diluted basis.
   
   
10. All NRIs taken together cannot purchase more than ____ per cent of the paid up value of the company.
    A. 14%
    B. 10%
    C. 16%
    D. 17%
    E. None of these
    
    Answer & Explanation

    B. 10%
    Explanation:
    All NRIs taken together cannot purchase more than 10 per cent of the paid up value of the company.