Review for FinMar.pdf

12/1/22, 10:55 PM Review for FinMar
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Review for FinMar
47 Questions
NAME :
CLASS :
DATE :
1. One of the elements of Financial System whih are characterized as players in the system
that have excess or willing to invest their funds in the system with the intent of earning
more out of these funds.
A Financial Intermediaries B Supplier of Funds
C Demanders of Funds D Regulatory Agency
2. They are arrangers of transactions between suppliers and demanders of funds. They act as
a middleman or conduit between the parties with the aim to perfect the exchange
A Financial Intermediaries B Financial Market
C Financial Instrument D Financial Institution
3. Policies were imposed to the financial system to ensure parity among parties which could
drive the following: Access to capital, credit and loan term offerings, support to providers of
financing, management of business risks, transaction costs and tariffs.
A Competitiveness B Consistency
C Stability D Market Behavior
4. Finance came from a ______ word which means settlement of debt
A Greek B Latin
C French
5. Regulators are the governance body that ensures that all complies with the rules, laws, and
regulations imposed to them.
A True B False
6. STATEMENT 1: In the financial market, the impact of financial risk is something the
regulatory environment should consider.
STATEMENT 2: The regulation must be able to protect the interest of the clients as well as
the companies to enable their corporate sustainability.
A Only statement 2 is true B Only statement 1 is true
C Both statements are true D Both statements are false
7. If the instrument used to trade in the financial market are issued first-hand or original
issuance, these are called Primary Market. If the instrument is traded one time, the player is
now called Secondary Market
A True B False
8. It is the probability that new laws, rules and regulations will be imposed and might affect the
ability to sustain its creditworthiness
A Credit Risk B Legal Risk
C Default Risk D Liquidity Risk
E Technological Risk
9. It is the probability to raise sufficient resources to repay its financial obligation
A Credit Risk B Technological Risk
C Legal Risk D Default Risk
E Liquidity Risk
10. Domestic Market and International or Foreign Market are Financial Markets classified under
A Instruments Traded B All of the above
C Origination D Market Type
E None of the above
11. Stock Markets and Bond Markets are equity or debt instruments traded in the Capital
Market and matures in
A Two years at most B Short term period
C Long term Period D One year or less

12. It allows the flow of funds to those who need it and those willing to extend or invest.
A Financial Market B Financial System
C Finance D Financial Institution
13. According to ______, Regulation is a process whereby the designated government authority
provides oversight and establishes rules for firms in an industry.
A Public Utility Research Center B Public Utility Research Institute
C Private Utility Research Center D Private Utility Research Institute
14. Financial Institutions may be generally classified into:
A Commercial banks B None of the above
C All of the above D Universal Banks
E Investment Banks
15. BSP, through its _______ _____, issues policies and guidelines where the players in the
financial systems must comply.
A Investment Board B Leader Board
C Regulatory Board D Monetary Board
16. The major financial regulator in the Philippines is
A Bangko Sentral ng Pilipinas B Board of Investment
C Securities and Exchange Commission D Investment Commission
17. It enables transfer of funds from a party to another thereby affecting settlement
A Finance B Payment System
C Financial Intermediaries D Financial System
18. _____ are those who are trading short term financial instruments that are legally traded.
A Bond Market B Stock Market
C Capital Market D Money Market
19. It is the probability that services will be interrupted due to technological resource limitation.
A Credit Risk B Technological Risk
C Liquidity Risk D Default Risk
E Legal Risk
20. Financial Regulation sets the parameters to ensure that firms will comply with the standards
and level the playing field. The policies were set to regulate the information disclosure,
advantage over internal information, entry of new players, minimum capital requirement
and minimum governance requirement.
A Stability B Market Behavior
C Competitiveness D Consistency
21. It is the governance body to ensure compliance to laws, rules and regulation and is
identified to provide oversight to the players in the industry.
A Regulatory Agency B Regulation
C Regulators D Financial Regulation
22. "Financial System is a set of arrangements or conventions embracing the lending and
borrowing of funds by non-financial economic units and the intermediation of this function
by financial intermediaries in order to facilitate the transfer of funds, to create additional
money, and to create markets in debt and equity instruments (and their derivatives) so that
the price and allocation of funds are determined efficiently"
A Dr. Faire (2015) B Dr. Faure (2013)
C Dr. Faire (2013) D Dr. Faure (2015)
23. Given that market behavior is dependent on a lot of factors, the risk is very high. Most of the
players failed to survive because of their inability to forecast and to mitigate the risk.
A Stability B Market Behavior
C Competitiveness D Consistency
24. The key financial regulators in the Philippines are
A Bangko Sentral ng Pilipinas B
Philippine Securities and Exchange
Commissions
C Board of Investments D Insurance Commissions

25. In _____ trade of private placement, these are normally issuance of stocks to pre-selected
investors
A Preferred B Secret
C Equity D Private
26. The Philippine Central Bank which is a self-regulating agency attached to the Department of
Finance which is generally focused on
A All of the above B Regulating the liquidity management
C Currency reserves and exchange rate D Currency Issues
E None of the above
27. Which of the following is false about Financial Intermediaries
A They have their own funds B None of the above
C
They may be financial institutions,
financial markets or private placement
D All of the above
E They act as channels of transmitting funds
28. These are intermediaries with a particular, private or specific individual or entity where the
supply and demand of funds will be taken.
A Capital Market B Private Placement
C Financial Institution D Financial Market
29. It is a venue where the demanders and suppliers of funds meet
A Financial Market B Financial System
C Financial Institution D Financial Intermediaries
30. They are entities that aims to collect or gather funds from suppliers and in return extend
this to the demanders of fund normally in the form of loans or any interest bearing
instruments.
A Financial Intermediaries B Financial Institutions
C Private Placements D Financial Market
31. The value in the Financial Instrument may be
A None of the above B Already determines
C Agreed by the parties D Both a and b
32. Financial System is a set of arrangements or conventions embracing the lending and
borrowing of funds by non-financial economic units and the intermediation of this function
by financial intermediaries in order to:
A Create additional money when required B Facilitate the transfer of funds
C
Create markets in debt and equity
instruments
33. The importance of payment systems is/are:
A Facilitates financial market transactions B All of the above
C Effective risk management D Managing safe and real time transactions
E None of the above
34. Which of the following sentence does not define "Finance"
A
It allows the flow of funds to those who
need it and those willing to extend or
invest.
B
It is a financial system that provides the
platform by which funds are transferred
from those entities that needs funds to
invest.
C
It is the application of economic principles
to deision-making that involves the
allocation of money under conditions of
unertainty.
D
It provides for the framework for making
decisions as to how those funds should be
obtained and then invested.
35. Financial Regulation is
A Both a and b B
A type of regulation that imposes
standards and policies to set controls over
the market factors that will affect the
financial sustainability
C None of the above D
Ensures that the risks are managed and all
parties in the financial system are
protected

36. Policies were imposed to the financial system to ensure parity among parties which could
drive the following
A Credit and loan term offerings B Transaction Costs and Tariffs
C Management of business risks D Access to Capital
E Support to providers of financing
37. It is the probability that currently maturing portion were not settled on time.
A Legal Risk B Technological Risk
C Default Risk D Liquidity Risk
E Credit Risk
38. They allow for the acceleration of the flow of funds between entities or players, efficiently
allocating funds or creation of money and supports price disovery.
A Financial Market B Financial Institution
C Financial Intermediaries D Private Placement
39. These are created to enforce financial regulations
A None of the above B Rules
C Regulations D Laws
40. The reason why in the field of accountancy ______ is an important principle is that it enables
the development of reasonable decisions. ______ plays a key attribute to ensure that the
other drivers affecting the results were isolated for better analysis and at the same time
reducing the risk of inherent in the results.
A Market Behavior B Competitiveness
C Stability D Consistency
41. These are traded in the Money Market:
I. Treasury Bills
II. Certificates of Deposit
III. Commercial Papers
IV. Treasury Bond
V. Treasury Note
VI. Repurchase Agreements
VII. Banker's Acceptance
A I, II, IV, V only B I, II, III, IV, VI, VII only
C I, II, III, IV, V, VI, VII D I, II, III, VI, VII
42. Financial Markets are classified into:
I. Instruments Traded
II. Market Type
III. Origination
A I, II, III B I and III only
C I only D I and II only
43. They set the framework and boundaries to protect the interest of the players in the system
A Regulatory Agency B Board of Regulatory Ageny
C Regulators D Regulation
44. It is the process of governing in the financial systems to ensure balance and protection of
interest of all players in the systems. By doing so, this manages the risk that will potentially
arise in the financial market system.
A Financial Regulation B Regulation
C Regulatory Agency D Regulators
45. It is the probability that the payor will not pay or settle its obligation.
A Default Risk B Credit Risk
C Legal Risk D Technological Risk
E Liquidity Risk
46. These are documents or representation for exchange
A Financial Institution B Financial Market
C Financial Instruments D Finance

47. Which of the following is not a definition of demanders of funds
A
Those who are willing to do actions to
earn more but restricted with financial
resources.
B All of the above
C
Those who are in need of additional
financing to sustain their livelihood for
domestic
D
The individuals or groups that need
financing
E None of the above
Answer Key
1.b 2.b 3.a 4.c
5.a 6.c 7.b 8.b
9.e 10.c 11.c 12.b
13.a 14.c 15.d 16.a
17.b 18.d 19.b 20.b
21.a 22.b 23.a 24.
25.c 26.a 27.a 28.b
29.a 30.b 31.d 32.
33.b 34.a 35.a 36.
37.c 38.c 39.d 40.d
41.d 42.a 43.c 44.a
45.b 46.c 47.e

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