WORKSHEET

BUSINESS STUDIES
CHAPTER 10
S.No. QUESTIONS
1. Mr. Sanjay Nehra was the Chairman of ‘Taran bank.’ The bank was 3 earning good
profits. Shareholders were happy as the bank was paying regular dividends. The
market price of their shares was also steadily rising. The bank was about to
announce taking over of ‘Vena Bank.’ Mr. Sanjay Nehra knew that the share price
of ‘Taran Bank’ would rise on this announcement. Being a part of the bank, he was
not allowed to buy shares of the bank. He called one of his rich friends Sudhir and
asked him to invest ₹5 crores in shares of his bank promising him the capital gains.
As expected the share prices went up by 40% and the market price of Sudhir’s
shares was now ₹7 crores. He earned a profit of ₹2 crores. He gave ₹1 crore to Mr.
Sanjay Nehra and kept ₹1 crore with himself. On regular inspection and by
conducting enquiries of the brokers involved, Securities and Exchange Board of
India (SEBI) was able to detect this irregularity. The SEBI imposed a heavy
penalty on Mr. Sanjay Nehra.
By quoting the lines from the above para identify and state any two functions that
were performed by SEBI in the above case (2016 board) (3 marks)
2. Explain the following money market instruments: (3 marks)
a) Commercial Paper, b) Commercial bill (2010 board)
3. State any four functions of ‘Stock Exchange.’ (2016 Board)
4. State any 5 regulatory functions of SEBI (2010 BOARD) (3 marks)
5. Differentiate between capital market and money market (2009 board) (3 marks)
6. Why was the SEBI set up? Explain any 4 objectives of it. (2009 board) (5 marks)
7. Explain the following money market instruments; (3 marks)
a) Treasury bill, b) Commercial Paper c) Call Money (2014 board)
8. State any one function of “Stock Exchange”. (2013 board) (1 mark)
9. Give the meaning of ‘Financial Market’. (2013 board) (1mark)
10. State any three protective functions of SEBI. (2013 & 2018 board) (3 marks)
11. What is meant by “Financial Market’? Explain any 2 functions of it. (3 marks)
(2011 board)
12. ‘To promote orderly and healthy growth of Securities market and protection of
investors, SEBI was set up’. With reference to this statement, explain the objectives
of SEBI. (2011 board) (4 marks)
13. List some examples of the malpractices in capital market which necessitated for
government to set up a separate regulatory body SEBI. (3 marks)
14. Explain the following functions of Stock Exchange. (3 marks)
a) Contributes to economic growth (b) Provides scope for speculation.
15. Explain the steps in the ‘Trading Procedure’ of Stock Exchange. (5 marks)
16. Explain any four methods of floatation of new issues in the primary market. (5
marks)
17. In today’s commercial world, stock exchange performs many vital six functions.
Give any such 6 functions. (6 marks)
18. RBI is the controller and guide of banks in India. In the field of stock market, an
institution similar to RBI is there. Name the institution and give its objectives and
functions. (6 marks)
19. 23. State the protective functions of Securities and Exchange Board of India.
(2018 board) (4 marks)
20. Keeping in mind the emerging nature of the securities market in India, Securities
and Exchange Board of India (SEBI) was entrusted with the twin task of regulation
and development of securities market. Out of this, state the developmental
functions of Securities and Exchange Board of India (SEBI). (2014 comptt.board)
(3 marks)
21. Distinguish between Primary market and Secondary market. (2014 comptt.board)
(6 marks)
22. What is meant by ‘Call Money’? (2017 comptt. Board) (1 mark)
23. An investor wanted to invest ₹20,000 in Treasury Bills for a period of 91 days.
When he approached the Reserve Bank of India for this purpose he came to
know that it was not possible. Identify the reason why the investor could not
invest in the Treasury Bill. (2018 Board 1 marks)
24. Sika Ltd., a reputed industrial machines manufacturer, needs Rupees twenty crores
as additional capital to expand the business. Mr. Amit Joshi, the Chief Executive
Officer (CEO) of the company wants to raise funds through equity. The Finance
Manager, Mr. Narinder Singh, suggested that the shares may be sold to investing
public through intermediaries, as the same will be less expensive. Name the method
through which the company decided to raise additional capital. (2017 All India) (1
mark)
25. ABC Ltd. issued prospectus for the subscription of its shares for ` 500 crores in
2008. The issue was oversubscribed by 20 times. The company issued shares to all
the applicants on pro-rata basis. Later SEBI inspected the prospectus and found
some misleading statement about the management of the company in it. SEBI
imposed a penalty of ` 5 crores and banned its three executive directors for dealing
in securities market for three years. Identify the function and its type performed by
SEBI in the above case. (Cbse Sample Paper 2016) (1 mark)
26. Explain the working of Demat system. (6 marks)

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