Download GTU (Gujarat Technological University) MBA 2019 Winter 3rd Sem 2830202 Management Of Financial Services Previous Question Paper
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA - SEMESTER ? III EXAMINATION ? WINTER 2019
Subject Code: 2830202 Date: 04-12-2019
Subject Name: Management of Financial Services
Time: 10:30 AM TO 1.30 PM Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q.1 [A] Attend the following MCQs: 6
1. A treasury bill is issued by
a. Government b. RBI
c. Commercial bank d. Development bank
2. Money market deals with borrowing and lending of funds for
a. Short term b. Medium Term
c. Long Term d. All of the above
3. For managing receivables of Rs. 20 Lakhs and converting them in to cash, which option
may be adopted
a. Forfeiting b. Factoring
c. Securitization d. None of the above
4. In which case ownership is immediately transferred in favor of user/purchaser
a. Lease b. Hire purchases
c. Installment sale d. None of the above
5. As per the SEBI guidelines, a merchant banker has to complete the whole process of issue
of shares in
a. 60 days b. 70 days
c. 80 days d. None of the above
6. Highest return is available on investment in
a. Shares b. Debentures
c. Bonds d. Mutual Fund
[B] Define the following terms:
1. Depository
2. Explain Business Risk & Financial risk
3. Broker vs sub broker
4. Bill Discounting
04
[C] Write a note on Margin Trading. 04
Q.2 [A] Describe in detail the Venture Capital financing process in India 07
[B] Define ?Mutual Fund? as per SEBI .Describe index funds and exchange Traded funds. 07
OR
[B] Explain Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) prescribed by RBI
for all commercial banks as a part of financial service supervision.
07
Q-3 [A] What is Hire ?Purchase? How is it different from Installment Sale or Leasing? 07
[B] Define Plastic Money. Discuss merits and demerits of Plastic Money. 07
OR
Q.3 [A] Discuss international factoring and its types.
07
FirstRanker.com - FirstRanker's Choice
Page 1 of 3
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA - SEMESTER ? III EXAMINATION ? WINTER 2019
Subject Code: 2830202 Date: 04-12-2019
Subject Name: Management of Financial Services
Time: 10:30 AM TO 1.30 PM Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q.1 [A] Attend the following MCQs: 6
1. A treasury bill is issued by
a. Government b. RBI
c. Commercial bank d. Development bank
2. Money market deals with borrowing and lending of funds for
a. Short term b. Medium Term
c. Long Term d. All of the above
3. For managing receivables of Rs. 20 Lakhs and converting them in to cash, which option
may be adopted
a. Forfeiting b. Factoring
c. Securitization d. None of the above
4. In which case ownership is immediately transferred in favor of user/purchaser
a. Lease b. Hire purchases
c. Installment sale d. None of the above
5. As per the SEBI guidelines, a merchant banker has to complete the whole process of issue
of shares in
a. 60 days b. 70 days
c. 80 days d. None of the above
6. Highest return is available on investment in
a. Shares b. Debentures
c. Bonds d. Mutual Fund
[B] Define the following terms:
1. Depository
2. Explain Business Risk & Financial risk
3. Broker vs sub broker
4. Bill Discounting
04
[C] Write a note on Margin Trading. 04
Q.2 [A] Describe in detail the Venture Capital financing process in India 07
[B] Define ?Mutual Fund? as per SEBI .Describe index funds and exchange Traded funds. 07
OR
[B] Explain Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) prescribed by RBI
for all commercial banks as a part of financial service supervision.
07
Q-3 [A] What is Hire ?Purchase? How is it different from Installment Sale or Leasing? 07
[B] Define Plastic Money. Discuss merits and demerits of Plastic Money. 07
OR
Q.3 [A] Discuss international factoring and its types.
07
Page 2 of 3
[B] Mention the situations favorable for Forfeiting and also the benefits of forfeiting.
07
Q.4 [A] ?Merchant Bankers are considered as sponsor of capital issues? ?Justify this statement
considering the role of merchant bankers in new issue management.
07
[B] Write a short note on importance of Money Market. 07
OR
Q-4 [A] Give an overview about the major credit rating agencies operating in India. 07
[B] ?SEBI plays an important role in the development of Stock Market.? Comment.
07
Q.5 Case Study
Demonetization ? Good or Bad?
On the night of November 8th, India witnessed a financial coup, the scale of which was
unparalleled in the entire human history. Demonetization of 86% of floating currency in the
market meant a huge transformation in the way businesses are being conducted in India.
Push for 100% cashless transactions meant that age-old customs had to be destroyed, and
new ways required to be learnt in order to conduct any type of business in the country.
The Good - Amul, the dairy cooperative jointly owned by 36 lakh milk producers in
Gujarat has adapted cashless mode in a massive way. Since November 8th, 5.4 lakh farmers
have opened their saving accounts in various banks. With this, almost 18 lakh milk
producers are now getting their money directly into their bank account. As per RS Sodhi,
MD of Amul, farmers are now saving a lot more, optimally planning their yearly financial
goals, and with bank accounts, are able to get loans at a lesser interest rate. Before, loan
sharks used to have a major influence in their financial world, as the farmers used to get
stuck within their high-interest trap, and ended up spending more money. He said, ?The
response from farmers to open bank accounts has been immense. Earlier, they were
spending money recklessly and had not developed the habit of saving. With their bank
accounts now being operational and a withdrawal limit in place, milk farmers have seen an
improvement in their savings too. Also, they can look forward to applying for loans once
they built a supporting credit history. And, as per Amul?s own data, there has been
absolutely no reduction in their sales, except few products of ice-cream. Sodhi said, ?On the
sales front, there was a short-term impact on discretion products such as ice-cream. But
there is absolutely no impact on sales of milk, butter and curd?.
The Bad - Raymond, the 91 year old behemoth of textiles and garments has said that post-
demonetization, they have experienced 30% reduction in sales. As per CEO Sanjay Behl,
90% of the textile market is based on cash, and the sudden demonetization drive has left the
industry crippled, and gasping for breath. Interestingly, Behl also said that they are
confident about stabilization of the market, as new currency is being introduced gradually,
and people are opting for cashless mode of payments. However, the reality is that 30% of
their products are not selling right now.
Questions:
1. The case narrates one example of each, the good effect and the bad effect of
demonetization. Which side do you take and why? Justify your answer with
necessary arguments.
2. How the government can ensure that the bad effects of the demonetization can be
reduced? Review the situation as on today when demonetization completes one
year.
14
FirstRanker.com - FirstRanker's Choice
Page 1 of 3
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA - SEMESTER ? III EXAMINATION ? WINTER 2019
Subject Code: 2830202 Date: 04-12-2019
Subject Name: Management of Financial Services
Time: 10:30 AM TO 1.30 PM Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q.1 [A] Attend the following MCQs: 6
1. A treasury bill is issued by
a. Government b. RBI
c. Commercial bank d. Development bank
2. Money market deals with borrowing and lending of funds for
a. Short term b. Medium Term
c. Long Term d. All of the above
3. For managing receivables of Rs. 20 Lakhs and converting them in to cash, which option
may be adopted
a. Forfeiting b. Factoring
c. Securitization d. None of the above
4. In which case ownership is immediately transferred in favor of user/purchaser
a. Lease b. Hire purchases
c. Installment sale d. None of the above
5. As per the SEBI guidelines, a merchant banker has to complete the whole process of issue
of shares in
a. 60 days b. 70 days
c. 80 days d. None of the above
6. Highest return is available on investment in
a. Shares b. Debentures
c. Bonds d. Mutual Fund
[B] Define the following terms:
1. Depository
2. Explain Business Risk & Financial risk
3. Broker vs sub broker
4. Bill Discounting
04
[C] Write a note on Margin Trading. 04
Q.2 [A] Describe in detail the Venture Capital financing process in India 07
[B] Define ?Mutual Fund? as per SEBI .Describe index funds and exchange Traded funds. 07
OR
[B] Explain Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) prescribed by RBI
for all commercial banks as a part of financial service supervision.
07
Q-3 [A] What is Hire ?Purchase? How is it different from Installment Sale or Leasing? 07
[B] Define Plastic Money. Discuss merits and demerits of Plastic Money. 07
OR
Q.3 [A] Discuss international factoring and its types.
07
Page 2 of 3
[B] Mention the situations favorable for Forfeiting and also the benefits of forfeiting.
07
Q.4 [A] ?Merchant Bankers are considered as sponsor of capital issues? ?Justify this statement
considering the role of merchant bankers in new issue management.
07
[B] Write a short note on importance of Money Market. 07
OR
Q-4 [A] Give an overview about the major credit rating agencies operating in India. 07
[B] ?SEBI plays an important role in the development of Stock Market.? Comment.
07
Q.5 Case Study
Demonetization ? Good or Bad?
On the night of November 8th, India witnessed a financial coup, the scale of which was
unparalleled in the entire human history. Demonetization of 86% of floating currency in the
market meant a huge transformation in the way businesses are being conducted in India.
Push for 100% cashless transactions meant that age-old customs had to be destroyed, and
new ways required to be learnt in order to conduct any type of business in the country.
The Good - Amul, the dairy cooperative jointly owned by 36 lakh milk producers in
Gujarat has adapted cashless mode in a massive way. Since November 8th, 5.4 lakh farmers
have opened their saving accounts in various banks. With this, almost 18 lakh milk
producers are now getting their money directly into their bank account. As per RS Sodhi,
MD of Amul, farmers are now saving a lot more, optimally planning their yearly financial
goals, and with bank accounts, are able to get loans at a lesser interest rate. Before, loan
sharks used to have a major influence in their financial world, as the farmers used to get
stuck within their high-interest trap, and ended up spending more money. He said, ?The
response from farmers to open bank accounts has been immense. Earlier, they were
spending money recklessly and had not developed the habit of saving. With their bank
accounts now being operational and a withdrawal limit in place, milk farmers have seen an
improvement in their savings too. Also, they can look forward to applying for loans once
they built a supporting credit history. And, as per Amul?s own data, there has been
absolutely no reduction in their sales, except few products of ice-cream. Sodhi said, ?On the
sales front, there was a short-term impact on discretion products such as ice-cream. But
there is absolutely no impact on sales of milk, butter and curd?.
The Bad - Raymond, the 91 year old behemoth of textiles and garments has said that post-
demonetization, they have experienced 30% reduction in sales. As per CEO Sanjay Behl,
90% of the textile market is based on cash, and the sudden demonetization drive has left the
industry crippled, and gasping for breath. Interestingly, Behl also said that they are
confident about stabilization of the market, as new currency is being introduced gradually,
and people are opting for cashless mode of payments. However, the reality is that 30% of
their products are not selling right now.
Questions:
1. The case narrates one example of each, the good effect and the bad effect of
demonetization. Which side do you take and why? Justify your answer with
necessary arguments.
2. How the government can ensure that the bad effects of the demonetization can be
reduced? Review the situation as on today when demonetization completes one
year.
14
Page 3 of 3
OR
Q.5
Case Study
Non Performing Assets ? A threat to Indian Banking System
The banking sectors are act as catalyst in achieving rapid economic development of a
country. They act as an intermediary to mobilize the excess fund of surplus sectors to
provide necessary finance to those sectors, which are needed to promote for the sound
development of the economy. Like other business enterprise, the efficiency of a bank is
evaluated based on profitability and quality of assets it possess. The asset quality is a prime
concern and impacts various performance indicators, i.e., profitability, liquidity,
intermediation costs, credibility, income generating capacity and overall functioning of
banks. The sound financial position of a bank depends upon the recovery of loans or its
level of Non-performing assets (NPAs).
The banking business has boomed since Independence, particularly after the LPG reforms.
The sector is expected to be valued at Rs 288 lakh crore by 2020. Out of this 70 per cent of
business is being done by PSU banks. An interesting fact is that SBI?s market share out of
total banking business is 22 per cent! Looking at the enormous size of the banking industry,
the NPAs are a big cause of concern. Loans don?t go bad right away. Most loans allow
customers a certain grace period. Then they are marked overdue. After a certain number of
days, the loan is classified as a nonperforming loan.
Banks usually classify as nonperforming assets any commercial loans which are more than
90 days overdue and any consumer loans which are more than 180 days overdue. For
agricultural loans, if the interest and/or the installment or principal remains overdue for two
harvest seasons; it is declared as NPAs. But, this period should not exceed two years. After
two years any unpaid loan/installment will be classified as NPA.
Indian banks' gross non-performing assets (NPAs), or bad loans, stood at Rs 10.25 lakh
crore as on 31 March 2018. On quarter, the pile has grown by Rs 1.39 lakh crore or 16
percent from Rs 8.86 lakh crore as on 31 December 2017. This chunk now accounts for
11.8 percent of the total loans given by the banking industry. For financial year 2018, the
total bad loans of these banks rose by a whopping Rs 3.13 lakh crore.
Questions:
1. Why NPAs are a serious issue and what harm can it do to the financial health of any
economy?
2. What are the reasons for the rising NPA levels in any economy? What could be the
possible way out for any economy to tackle the problem of NPAs?
14
*************
FirstRanker.com - FirstRanker's Choice
This post was last modified on 19 February 2020