JAIIB Exam 2025 – IE&IFS Important Questions MCQs Quiz-31

09/04/2025

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JAIIB Exam 2025 IE&IFS Important Questions MCQs Quiz-31

JAIIB Exam Quiz 2025: The JAIIB exam is scheduled for 2025 by IIBF. Here, we are providing JAIIB IE&IFS MCQ-based quizzes on a regular basis. You can attempt the quizzes regularly to prepare for the upcoming JAIIB exam. The quizzes will be provided module-wise and unit-wise. You can attempt the JAIIB IE&IFS quizzes from the links below and improve your preparation by practicing regularly. These quizzes will help you boost your score in the JAIIB exam and guide you to clear the exam on your first attempt.

Q.1 Which of the following statements about the primary market is correct?
A) Securities in the primary market are issued only through private placement.
B) The primary market deals with the trading of already issued securities.
C) Banks can participate in the primary market as underwriters and arrangers.
D) SEBI does not regulate the issuance of securities in the primary market

Q.2 Which of the following statements about the secondary market is correct?
A) The secondary market is where securities are initially issued to the public.
B) The secondary market consists only of equity markets.
C) Stock exchanges operate as part of the auction market, while OTC markets function as dealer markets.
D) Banks cannot participate in secondary market transactions

Q 3 Which of the following statements is correct regarding stock exchanges in India?
A) The Calcutta Stock Exchange has remained inactive for several years despite having permanent recognition.
B) BSE Ltd. is the newest stock exchange in India.
C) NSE was established before BSE.
D) The Metropolitan Stock Exchange of India Ltd. was established before 1990

Q.4 Which of the following statements about Indian stock exchanges is correct?
A) India International Exchange (India INX) is a subsidiary of NSE.
B) NSE IFSC Ltd. is located in Mumbai.
C) Over the Counter Exchange of India Ltd. (OTCEI) was established to help promoters raise finance cost-effectively.
D) India INX and NSE IFSC Ltd. are both headquartered in Delhi.

Q.5 Which of the following best describes demutualisation of a stock exchange?
A) It allows broker members to manage, own, and trade on the exchange.
B) It is the transition of an exchange from a mutually owned association to a shareholders-owned company.
C) It merges ownership, management, and trading functions into a single entity.
D) It eliminates trading rights for all members of the exchange.

Q.6 Which of the following is NOT a function of a depository in India?
A) Maintaining ownership records of securities in book-entry form.
B) Rendering services directly to investors without any intermediary.
C) Facilitating dematerialisation and fungibility of securities.
D) Enhancing liquidity in the securities market by enabling faster settlements

Q.7 Which of the following statements correctly differentiates NSDL and CDSL?
A) NSDL dematerialised account numbers consist of 16 numeric digits, while CDSL accounts begin with ‘IN’ followed by 14 numeric digits.
B) CDSL was established before NSDL and is promoted by NSE.
C) NSDL is promoted by IDBI, UTI, and NSE, while CDSL is promoted by BSE along with leading banks.
D) Both NSDL and CDSL use the same format for dematerialised account numbers

Q.8 Which of the following statements about preference shares is correct?
A) Preference shareholders always have voting rights in company decisions.
B) In case of liquidation, preference shareholders are paid before bondholders and creditors.
C) Preference shareholders receive dividends before equity shareholders.
D) A company can issue redeemable preference shares with a tenure exceeding 30 years.

Q.9 What distinguishes cumulative preference shares from other preference shares?
A) They provide voting rights to shareholders.
B) They allow shareholders to participate in additional profits above a fixed dividend.
C) They are automatically converted into equity shares after a specific period
D) They accumulate unpaid dividends, which must be paid before any equity dividend is issued.

Q.10 Which of the following best describes Participating Preference Shares?
A) They grant shareholders voting rights in company decisions.
B) They allow shareholders to receive additional dividends after a fixed dividend is paid, based on equity shareholders’ dividends.
C) They accumulate unpaid dividends, which must be cleared before equity shareholders receive any dividend.
D) They automatically convert into equity shares after a specific period.

Q.11 Which of the following statements correctly differentiates Zero-Coupon Bonds from Coupon Bonds?
A) Zero-Coupon Bonds pay periodic interest, whereas Coupon Bonds do not.
B) Coupon Bonds provide regular interest payments, while Zero-Coupon Bonds are issued at a discount and offer a single payment at maturity.
C) Coupon Bonds are always convertible into equity, while Zero- Coupon Bonds are not.
D) Zero-Coupon Bonds have a fixed yield-to-maturity, whereas Coupon Bonds do not trade based on market interest rates

Q. 12 What is the primary purpose of the Securities Transaction Tax (STT) in India?
A) To regulate insider trading in the stock market.
B) To levy a tax on stock exchange transactions as per government-prescribed rates.
C) To control inflation by taxing capital market participants.
D) To replace capital gains tax on equity investments

Q.13 What is the primary objective of the Securities Lending and Borrowing (SLB) scheme?
A) To enable investors to pledge securities as collateral for loans
B) To allow investors to lend idle securities and earn a return
C) To facilitate direct trading between retail investors and institutions
D) To eliminate the role of clearing corporations in stock market transactions

Q.14 What happens if a defaulting selling broker fails to deliver securities within the specified period under the SLB scheme?
A) The transaction is canceled without any penalty.
B) The clearing corporation buys the securities from the open market and returns them to the lender within seven trading days.
C) The lender is required to wait until the broker can arrange delivery.
D) The securities are automatically transferred from another lender’s account.

Q.15 What is the key difference between an Initial Public Offering (IPO) and a Follow-on Public Offering (FPO)?
A) IPO is the first time a company offers shares to the public, while FPO is when an already listed company issues additional shares.
B) IPO is only for institutional investors, while FPO is for retail investors.
C) IPO is issued at a fixed price, while FPO is always issued through a book-building process.
D) IPO is regulated by SEBI, while FPO is not subject to SEBI guidelines

Q.16 Which of the following statements best explains the key advantage of a Rights Issue (RI) for existing shareholders?
A) It allows existing shareholders to purchase additional shares at a discounted price, preventing dilution of their ownership stake.
B) It enables companies to raise capital exclusively from institutional investors, ensuring better price discovery.
C) It mandates that all shareholders must subscribe toadditional shares in proportion to their existing holdings.
D) It ensures that only a select group of investors can participate, similar to a private placement

Q.17 Which regulatory requirement must a listed company fulfill before making a rights issue exceeding ₹50 lakhs?
A) Obtain prior approval from SEBI and file a placement document post-allotment.
B) File a draft letter of offer with SEBI through a Merchant Banker at least 30 days before submission to the Designated Stock Exchange.
C) Conduct a preferential allotment instead of a rights issue to avoid filing requirements.
D) Seek approval from Qualified Institutional Buyers (QIBs) before proceeding with the issue

Q.18 What is the key characteristic of a Red Herring Prospectus (RHP)?
A) It contains the final issue price and number of shares being offered.
B) It is used only for Fixed Price Issues and not for Book Building Issues.
C) It does not include details of the final price or number of shares at the time of filing.
D) It is a prospectus that guarantees fixed returns on the issued securities

Q.19 What was the primary reason for the introduction of Qualified Institutional Placement (QIP) by SEBI in 2006?
A) To allow companies to raise capital from foreign investors easily.
B) To provide listed companies a faster way to raise funds domestically and reduce reliance on foreign capital.
C) To replace the need for Foreign Currency Convertible Bonds (FCCBs) and Global Depository Receipts (GDRs) entirely.
D) To enable retail investors to participate in private placements along with institutional investors

Q.20 Which of the following conditions must be met for an investor to apply through Applications Supported by Blocked Amount (ASBA) in a rights issue?
A) The investor must hold shares in dematerialized form and apply for entitlements or additional shares.
B) The investor must hold shares in physical form and apply for additional shares.
C) The investor must renounce at least part of their entitlements before applying.
D) The investor must make the payment before the allotment of shares

Q.21 What is the primary purpose of the Book Building process in an IPO?
A) To determine the fixed price of securities before issuing them to investors.
B) To assess demand and discover the price of securities based on investor bids.
C) To allocate shares equally among all investors without considering demand.
D) To issue shares at a discount to retail investors only.

Q.22 In a 100% net offer to the public through a voluntary book-built issue, what is the maximum percentage of the net offer that can be allocated to Qualified Institutional Buyers (QIBs)?
A) 25%
B) 35%
C) 50%
D) 65%

Q.23 In a compulsory Book-Built Issue, what is the minimum percentage of the net offer that must be allotted to Qualified Institutional Buyers (QIBs)?
A) 50%
B) 60%
C) 75%
D) 90%

Q.24 in the case of Fixed Price Issues, what is the minimum percentage of the net offer of securities that must initially be made available for Retail Individual Investors (RIIs)?
A) 25%
B) 35%
C) 50%
D) 75%

Q.25 Which of the following statements correctly defines the Green Shoe Option in the context of a public issue?
A) It allows retail investors to apply for additional shares beyond their allotted quota.
B) It is a mechanism enabling companies to issue additional shares to stabilize post-listing prices.
C) It permits anchor investors to withdraw their application before the allotment process.
D) It is an option given to Qualified Institutional Buyers (QIBs) to acquire shares at a discounted price

Q.26 What is the minimum application value required for an investor to qualify as an Anchor Investor in a main board public issue under SEBI regulations?
A) ₹5 crore
B) ₹10 crore
C) ₹2 crore
D) ₹15 crore

Answer:

Q1: C
Q2: C
Q3: A
Q4: C
Q5: B
Q6: B
Q7: C
Q8: C
Q9: D
Q10: B
Q11: B
Q12: B
Q13: B
Q14: B
Q15: A
Q16: A
Q17: B
Q18: C
Q19: B
Q20: A
Q21: B
Q22: C
Q23: C
Q24: C
Q25: B
Q26: V