1.
A Bank received an LC for USD 2 Mio issued by MT 700 and opened on Jan 25,
2011. The credit calls for shipment of 200 tonnes of good quality wheat cultivated
in Punjab. By default, whether the provisions of UCP 600 apply to this credit?
1. Yes, UCP 600 applies to this credit
2. No, UCP 600 does not apply
3. Only certain articles of UCP 600 apply to the credit
4. Yes, UCP 600 applies with permission from ICC
2. In terms of article 3 of UCP 600, if there is no mention, LC will be treated as what
type of LC?
1. Revocable LC 2. Irrevocable LC
3. Confirmed LC 4. Back to back LC
3. Exchange risk in forex transactions mainly arises because of ____________
1) Geographical dispersion of market players
2) Time zone differences between the counter parties
3) Big ticket size of the transactions
4) Fluctuation of exchange rates every four seconds
4. The office created exclusively to provide information to the management and
implement risk management systems is known as
1) Front office 2) Mid office
3) Back office 4) Integrated Treasury
5. The primary function of treasury is to _________
1) meet SLR and CRR requirement
2) manage liquidity to meet CRR requirement
3) meet SLR requirement only
4) utilize arbitrage opportunities for maximizing profits
6. Every exporter should obtain a code number before making exports. What is the
number?
1) Exporter's code number issued by RBI
2) Identification number issued by Export Promotion Council
3) IEC number issued by DGFT
4) Facilitation number issued by FIEO
7. How forward rates are calculated?
1) By adding a mark up to spot rates
2) By adding premium or discount to spot rates
3) By deducting premium or discount from spot rates
4) By adding premium to and deducting discount from spot rates
8. An import bill not retired by the importer should be crystallized by the bank
on what day?
i.On 21st day from the date of Bill of Lading
ii. On the 10th day from the receipt of documents at the counters of the bank
iii.On the expiry of five banking days
iv.On the day of receipt of the Bill
9. In the case of country risk, banks will adopt the country risk classification
given by the following agency.
1) Reserve Bank of India 2) Euro Money
3) ECGC 4) Exim Bank
10. The quotation of 1 PGK=$ 0.4435 in Papua New Guinea is an example of ________
1) Direct quotation 2) Indirect quotation
3) Competitive quotation 4) Aggressive quotation
11. All foreign currency inward remittances upto what amount shall, as per FEDAI
guidelines, be converted immediately into Indian Rupees?
1) Rs. 50000 equivalent 2) USD 10000
3) USD 5000 4) £ 1000
12. What is the time available for issuing bank for examination of documents under
UCP600?
1) 21 days
2) Reasonable time not exceeding 7 days
3) Reasonable time not exceeding 7 banking days
4) Five banking days
13. SBI maintains USD account with Bank of America, New York and when it
conducts transactions through this account, it passes entries in its books at
Mumbai through the following account
1) Nostro account 2) Vostro account
3) Loro account 4) Mirror account
14. What is the principal purpose of Interest Rate Swaps?
1) Help borrowers/lenders to switch their borrowings/lending from fixed to floating
rate structures and vice versa
2) Help players maximize interest earnings
3) Help accelerate interest due payments
4) Help the markets increase volumes
15. How many Diamond Dollar Accounts can an Exporter maintain?
1) Only one 2) Two accounts
3) It is matter of discretion for the bank 4) Five
16. SWIFT has introduced new system of authentication of messages between banks
replacing Bilateral Key Exchange(BKE) with RMA. RMA stands for ..
1) Resources Maximization Abinitio
2) Real Macro Accounts
3) Relationship Management Application
4) Rotational Management Approach
17. Who is eligible to take Export turnover policy from ECGC?
1) Exporters with turnover not exceeding Rs 10 lakhs per year
2) Exporters who contribute not less than Rs. 10 lakhs towards premium
3) Exporters with turnover exceeding Rs 10 lakhs per year
4) Exporters who contribute not more than Rs. 10 lakhs towards premium
18. Integrated Treasury refers to integration of which of the following?
1) Money Market 2) Securities Market
3) Foreign exchange operations 4) All the above
19. What is Open position?
1) Any residual position of a bank at the end of the day-over bought
2) Any residual position of a bank at the end of the day-over sold
3) None of the above
4) 1 & 2 both
20. Which of the following statement is false for a ‘Forward Contract’?
1) An OTC Product
2) Credit Risk on counter parties exists
3) Can be for odd amount
4) Works on Margins requirement
21. An Irrevocable Letter of Credit can be amended with the consent of following
parties.
1) The Applicant (Buyer) and the Beneficiary (Seller).
2) Issuing Bank and Confirming Bank.
3) The Advising Bank & Reimbursing Bank.
4) (a) & (B) only
22. A ‘Red Clause’ Letter of Credit enables the beneficiary to avail pre-shipment
credit from
1) L/C Issuing Bank
2) L/C Confirming Bank
3) L/C Advising Bank or Nominated Bank
4) Any bank preferred by the beneficiary.
23. In case of an Acceptance Credit, the usance period is calculated from the date of
Shipment or date of Bills of Exchange.
1) Statement is true
2) Statement is false
3) Statement is partially true
4) None of the above
24. A ‘Certificate of Origin’ accompanying documents must be issued & signed by:
1) Exporter/Seller
2) Shipping Agents
3) Customs Officials
4) Chamber of Commerce of Exporter’s Country.
25. ‘Crystallization’ of Foreign Currency Liability of the importer to be done by the
Issuing bank on the 10th day from due date of payment in case of failure on the
part of importer. The conversion of Foreign Currency Liability to Rupee liability is
done at:
1) Bill Buying Rate
2) TT Selling Rate
3) Bill Selling Rate
4) Spot Rate
26. Export Proceeds from any of the ACU countries should be settled under ACU
mechanism except:
1)Sri Lanka 2) Nepal 3)Pakistan 4) Republic of Iran
27. Maximum amount for which AD can permit for realization of export proceeds
beyond six months is:
1) USD 100,000 2)USD 1,000,000
3) USD 50,000 4) No such limit prescribed
28. Waiver (exemption) for submission of GR form is made in case of
export/Remittance of Foreign Exchange in which of the following case(s)?
1) Gift up to Rs.5 lacs
2) Trade Samples
3) Export up to US $ 25000
4) All of the above
29. The NPT (Notional Transit Period) computation for Advance against Bills sent on
collection, the period commences from:
1) Bill of Lading
2) Date of Bills of Exchange
3) Date of acceptance of Bill at Branch level for collection
4) Usance period
30. IEC Code is issued by:
1) RBI 2) EXIM Bank 3) ECGC 4)DGFT
31. Credit arranged by the importer (buyer) from a bank/FI outside his country to
settle payments of imports is known as:
1) Supplier’s Credit 2) Buyer’s Credit
3) External Commercial Borrowing 4) GDR
32. Payment in rupees for purchase of foreign exchange may be done in cash, if the
rupee value equivalent is not more than
1) Rs 1,00,000
2) Rs 50,000
3) Rs 2,00,000
4) None of the above
33. Which of the following statement is correct?
1) Foreign Exchange markets are localized markets.
2) Foreign Exchange markets operate within a country’s time zone.
3) Foreign Exchange markets are dynamic and round the clock markets.
4) Foreign Exchange markets are used only for trade related transactions.
34. Which of the following definitions is most correct?
UCPDC 500 is :
1) Set of rules applicable to CC transactions
2) Set of rule having 500 articles.
3) Set of rules framed by ICC governing LC business globally.
4) Set of universally applicable rules governing LC business in India only.
35. If market quotes USD/INR as 43.61/63, at what rate can you buy USD at the given
quote:
1) 43.61 2) 43.62 3) 43.63 4) None of the above.
