Sample Questions

NCFM Financial Market Beginner Module Mock Test — 5 random MCQs with answers & explanations

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These 5 questions are randomly selected (standard MCQs only, not case-based).

Q1 Treasury bills (T-bills) are issued by the government for which of the following durations?

  • A. 91 days
  • B. 182 days
  • C. 364 days
  • D. All of the above Correct Answer
Explanation:
The government offers T-bills for these three standard short-term maturity periods.

Marks: 1

Q2 What does the abbreviation 'SBTS' stand for in the context of the NSE?

  • A. System based trading system
  • B. Screen based transaction system
  • C. Screen based trading system Correct Answer
  • D. System based trading system
Explanation:
SBTS stands for Screen Based Trading System, which replaced traditional floor-based trading with electronic terminals.

Marks: 1

Q3 Which branch of investment analysis focuses on studying historical stock price movements and trading volumes?

  • A. Fundamental analysis
  • B. Pattern analysis
  • C. Technical analysis Correct Answer
  • D. Market sentiment analysis
Explanation:
Technical analysis uses charts and past data (price and volume) to predict future price trends, based on the idea that historical market behavior repeats itself.

Marks: 1

Q4 Identify the different categories that fall under the term 'derivatives'.

  • A. Futures
  • B. Forwards
  • C. Options
  • D. All of the above Correct Answer
Explanation:
Derivatives are financial contracts that include various types such as Futures, Forwards, Options, and Warrants. Each of these instruments derives its value from an underlying asset.

Marks: 1

Q5 True or False: Similar to mutual funds, an ETF's NAV is only calculated once at the end of the trading day.

  • A. True
  • B. False Correct Answer
Explanation:
This is false. While mutual fund NAVs are end-of-day, the price of an ETF fluctuates and is visible throughout the entire trading day on the exchange.

Marks: 1

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