LIC AAO Mains 2019- Financial and Insurance Market Questions | 26th June

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LIC AAO Mains 2019- Financial and Insurance Market Questions | 26th June

LIC AAO Mains 2019- Financial and Insurance Market Questions

As we know, LIC has released both the vacancies of AAO (Assistant Administrative Officer) & ADO (Apprentice Development Officer). Insurance Market & Financial Awareness is a newly introduced section which will be asked in both the exams. LIC AAO mains 2019 is scheduled to be held on 28th June. While LIC ADO Prelims 2019 is scheduled to be held on 6th & 13th July. Here is a quiz on Insurance Market & Financial Awareness being provided by Adda247 for free to let you practice the best of latest pattern Questions for LIC examination for sure shot selection.




Q1. A market for debt securities that pay off in the short term usually less than one Year is known as-?
Security Market
Debt Market
Money Market
Capital Market
Secondary Market
Solution:
Money market is a market for debt securities that pay off in the short term usually less than one year, for example the market for 90-days treasury bills. This market encompasses the trading and issuance of short term non-equity debt instruments including treasury bills, commercial papers, bankers acceptance, certificates of deposits, etc.
Q2. The SEBI is the regulatory authority established under Section 3 of which Act?
SEBI Act 1992
SEBI Act 1990
SEBI Act 1988
SEBI Act 1982
SEBI Act 1999
Solution:
The SEBI is the regulatory authority established under Section 3 of SEBI Act 1992 to protect the interests of the investors in securities and to promote the development of, and to regulate, the securities market and for matters connected therewith and incidental thereto.
Q3. What is full form of MIRSD?
Money Intermediaries Regulation and Supervision Department
Market Intermediaries Rules and Supervision Department
Market Intermediaries Regulation and Supervision Department
Money Intermediaries Rules and Supervision Department
None of the given options is true
Solution:
The Market Intermediaries Regulation and Supervision Department (MIRSD) is responsible for the registration, supervision, compliance monitoring and inspections of all market intermediaries in respect of all segments of the markets viz. equity, equity derivatives, currency derivatives, debt and debt related derivatives and commodity derivative.
Q4. Name the share, which referred to as ordinary share also represents the form of fractional ownership in which a shareholder, as a fractional owner, undertakes the maximum entrepreneurial risk associated with a business venture.
Preference shares
Equity share
Cumulative Preference Shares
Participating Preference Share
None of the given options is true
Solution:
An equity share, commonly referred to as ordinary share also represents the form of fractional ownership in which a shareholder, as a fractional owner, undertakes the maximum entrepreneurial risk associated with a business venture. The holders of such shares are members of the company and have voting rights.
Q5. The issue of new securities to existing shareholders at ratio to those already held is known as-?
Preference shares
Rights shares (Issue)
Bonus shares
Cumulative preference shares
None of the given options is true
Solution:
The issue of new securities to existing shareholders at a ratio to those already held.
Q6. In the ______________, the securities like shares and debentures are offered to the public subscription for the purpose of raising capital or fund.

Secondary market
Primary market
Share market
Debenture market
None of the given options is true
Solution:
In the primary market the securities like shares and debentures are offered to the public subscription for the purpose of raising capital or fund
Q7. Net Profit Ratio Signifies:
Operational Profitability
Liquidity Position
Big-term Solvency
Profit for Lenders
Short-term solvency
Solution:
The net profit percentage is the ratio of after-tax profits to net sales. It reveals the remaining profit after all costs of production, administration, and financing have been deducted from sales, and income taxes recognized. As such, it is one of the best measures of the overall results of a firm, especially when combined with an evaluation of how well it is using its working capital. The measure is commonly reported on a trend line, to judge performance over time. It is also used to compare the results of a business with its competitors.
Q8. Total national consumption consists of-
Public consumption
Private and public consumption
Private consumption
Exports
None of the given options is true
Solution:
The consumption function, or Keynesian consumption function, is an economic formula that represents the functional relationship between total consumption and gross national income.
Q9. ______ is a type of preference share where the dividend payable on the same accumulates, if not paid and after a specified date, these shares will be converted into equity capital of the company.
Preference shares
Cumulative preference shares
Cumulative convertible preference shares
Participating preference shares
None of the given options is true
Solution:
Cumulative convertible preference shares is a type of share, where the dividend payable on the same accumulates, if not paid. After a specified date, these shares will be converted into equity capital of the company.
Q10. Which of the following is not a direct tax?
Income tax
Wealth tax
Sales tax
Estate duty
None of the given options is true
Solution:
A sales tax is a consumption tax imposed by the government on the sale of goods and services. A conventional sales tax is levied at the point of sale, collected by the retailer, and passed on to the government.
Q11. A _________________ is a person who has an insurance policy with an insurance company.
ADO
Policyholder
Assistant Administrative Officer
Insurance Agent
Premium
Solution:
Policyholder definition: A policyholder is a person who has an insurance policy with an insurance company.
Q12. TPA is a person or organization that processes claims and performs other administrative services in accordance with a service contract, usually in the field of employee benefits. What is the full form of TPA?
Third Party Allowed
Treaty Party Administration
Third Panel Administration
Third Party Assistant
Third Party Administration
Solution:
A Third Party Administrator (TPA) is a person or organization that processes claims and performs other administrative services in accordance with a service contract, usually in the field of employee benefits.
Q13. Who are responsible for clerical completion of all claim files in insurance sector?

Insurance Agent
Frequency-Severity Matrix
Claim Service Representative
Third Party Administration
Assistant Administrative Officer
Solution:
Claim Service Representative- Also called CSR; they are responsible for clerical completion of all claim files.
Q14. ____________________ Offers cover for third party liabilities (Bodily Injury/Property Damage) arising out of the premises and operations of the Insured and legal costs incurred in connection therewith.
Public Liability Insurance
Negotiated Dealing System
Trade Related Investment Measures
Board for Industrial and Financial Reconstruction
Insurance Regulatory and Development
Solution:
Public Liability Insurance or PLI offers cover for third party liabilities (Bodily Injury/Property Damage) arising out of the premises and operations of the Insured and legal costs incurred in connection therewith.
Q15. ___________________ is the written insurance contract that may include all clauses, riders and endorsements.
Pooling
Peril
Premium
Policy
Physical Hazard
Solution:
Policy is the written insurance contract that may include all clauses, riders and endorsements.
               



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