NISM-Series-XV - Research Analyst Certification Exam - 22

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Q 1. What does Regulation 15 require regarding dealing and trading by research analysts?

a) Dealing and trading are prohibited.

b) Dealing and trading are allowed without any restrictions.

c) Dealing and trading are allowed only during market hours.

d) Dealing and trading are allowed with written internal policies and control procedures addressing conflicts of interest.

e) No specific requirements for dealing and trading.
 
Q 2. How does a Neutral fiscal policy differ from an Expansionary fiscal policy?

a) Both aim to cool down the economy

b) Neutral fiscal policy involves lower government spending

c) Expansionary fiscal policy involves higher government spending

d) Both involve the repayment of debts

e) Neutral fiscal policy is used during recessions
 
Q 3. How does a shareholder's holding change in a 5:1 share consolidation?

a) It remains the same

b) It increases 5 times

c) It decreases 5 times

d) It doubles

e) It halves
 
Q 4. What type of records is a research analyst or research entity required to maintain according to Regulation 25(1)(iv)?

a) Financial statements

b) Record of public appearance

c) Employee attendance records

d) Internal meeting minutes

e) Customer complaints
 
Q 5. Which industry type experiences growth in sales during the expansionary phase and some base-level demand during the recessionary phase?

a) Defensive industries

b) Deep cyclical industries

c) Semi-cyclical industries

d) Capital goods industries

e) Consumer durables industries
 
Q 6. In a share swap, what does each shareholder of the acquired company receive from the acquiring company?

a) Cash

b) Bonds

c) Pre-determined amount of shares

d) Dividends

e) None of the above
 
Q 7. What is the primary focus of Sell-side Analysts in their research reports?

a) Provide internal investment recommendations

b) Analyzing competitive landscapes

c) Evaluating the past performance of companies

d) Recommending securities with specific buy/sell/hold recommendations

e) Generating reports for internal consumption
 
Q 8. How does the legal architecture of a country influence businesses?

a) By determining cultural values

b) By shaping technological advancements

c) By ensuring consistency in legal aspects and protection of businesses

d) By impacting demographic profiles

e) By influencing economic policies
 
Q 9. In the given example, which finance company is considered less expensive based on the Price/Book ratio?

a) AFB Finance

b) LKH Finance

c) Both are equally expensive

d) Both are equally inexpensive

e) It cannot be determined from the information provided
 
Q 10. What is the significance of Net Asset Value (NAV) for Mutual Fund units?

a) It represents the fixed unit capital of the fund

b) It is a measure of the fund's expense ratios

c) It reflects changes in the value of the fund's portfolio

d) It indicates the maturity period of the fund

e) It tracks the real-time prices of the units
 
Q 11. Under what circumstances does a company have to pay 18.5% of its book profits as Minimum Alternate Tax (MAT)?

a) If the income tax payable is more than 18.5% of book profits

b) If the income tax payable is equal to 18.5% of book profits

c) If the income tax payable is less than 18.5% of book profits

d) If the company's profit exceeds Rs. 10 crores

e) If the company's profit is below Rs. 1 crore
 
Q 12. Which of the following is NOT a common source of Business Risk?

a) Cost of raw materials

b) Employee costs

c) Currency fluctuations

d) Introduction of competing products

e) Marketing and distribution costs
 
Q 13. What is the primary purpose of the secondary market?

a) To directly negotiate trades between issuers and investors.

b) To facilitate the growth of the primary market.

c) To guarantee settlement of trades for investors.

d) To provide liquidity to securities.

e) To enable issuers to raise fresh capital.
 
Q 14. Why can technological disruptions that favor one industry be a threat to othe rs?

a) they create opportunities for growth

b) they lead to economic recession

c) they increase customer concentration

d) they create a competitive advantage

e) they render certain industries obsolete
 
Q 15.  According to Benjamin Graham's allegory of Mr. Market, what should investors do?

a) Follow Mr. Market's emotions for timely decisions.

b) Allow Mr. Market's emotions to drive their own emotions.

c) Disregard Mr. Market's assessments of the firm.

d) Look for opportunities when Mr. Market misprices products.

e) Increase or decrease shares based on Mr. Market's daily assessments.

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