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Financial Services Interview Questions & Answers - Learning Mode
COOLINTERVIEW.COM INDIAN FINANCIAL SYSTEM INTERVIEW QUESTIONS FINANCIAL SERVICES INTERVIEW QUESTIONS QUESTIONS & ANSWERS - LEARNING MODE

Financial Services Interview Questions & Answers - Learning Mode

Financial services are the economic services provided by the finance industry, which encompasses a broad range of businesses that manage money, including credit unions, banks, credit-card companies, insurance companies, accountancy companies, consumer-finance companies, stock brokerages, investment funds and some government-sponsored enterprises.

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Financial Services Interview Questions & Answers - Learning Mode
Try Financial Services Interview Questions & Answers - Exam Mode
Question: State the types of Lease in Financial services?

Answer: a)Capital lease
b)Operating lease
c)Sale and lease back
d)Leveraged lease
e)International lease
f)Domestic lease Source: CoolInterview.com
Question: When a load resistance is removed from the output of a voltage divider circuit, the current drawn from the source A. decreases B. increases C. remains the same D. is cut off

Answer: An accepted draft or bill of exchange sold for early payment to a bank or credit institution at less than face value after the bank deducts fees and applicable interest charges. The bank or credit institution then collects full value on the draft or bill of exchange when payment comes due. Source: CoolInterview.com
Question: What is the meaning of Mergers?

Answer: Merger refers to combining of two or more company and forming new company. Two or more company merge to form one new company is called as merger. Source: CoolInterview.com
Question: State the types of International Factoring?

Answer: a)Single or direct factoring system
b)Direct export factoring
c)Direct import factoring
d)Back to back factoring Source: CoolInterview.com
Question: State the types of Merger?

Answer: a)Horizontal Merger
b)Vertical Merger
c)Conglomerate Merger
d)Acquisition Source: CoolInterview.com
Question: State the disadvantages of Hire Purchase System?

Answer: i. Ownership of asset is transferred only after the payment of the last installment.
ii. The magnitude of funds involved in hire purchase are very small and only small types of assets like office equipment's, automobiles, etc., are purchased through it.
iii. The cost of financing through hire purchase is very high.
Source: CoolInterview.com
Question: What is meant by the term "Financial Services"?

Answer: Financial Services is a term used to refer to the services provided by the finance market. Financial Services is also the term used to describe organizations that deal with the management of money. Examples are the Banks, investment banks, insurance companies, credit card companies and stock brokerages. Source: CoolInterview.com
Question: State the benefits of Factoring?

Answer: a)Facilitate liquidity
b)Reduces the risk
c)Expertise services
d)Maximize profitability
e)Time saving Source: CoolInterview.com
Question: Describe the purpose of Housing Finance?

Answer: ?The purpose of a housing finance system is to provide the funds which home-buyers need to purchase their homes. This is a simple objective, and the number of ways in which it can be achieved is limited. Notwithstanding this basic simplicity, in a number of countries, largely as a result of government action, very complicated housing finance systems have been developed. However, the essential feature of any system, that is, the ability to channel the funds of investors to those purchasing their Source: CoolInterview.com
Question: A 120 load is connected across a voltage source with VS = 12 V and RS = 8 . The voltage across the load is A. 11.25 V B. 0 V C. 12 V D. 1.13 V

Answer: The types of Domestic factoring are discussed below:
(i) Recourse Factoring
(ii) Non-Recourse Factoring
(iii) Advance Factoring
(iv) Confidential and Undisclosed Factoring
(v) Maturity Factoring.
(vi) Supplier Guarantee Factoring
(vii) Bank Participation Factoring Source: CoolInterview.com
Question: State the difference between Bill of exchange and Factoring?

Answer: 1. Bill discounting is always of recourse type while factoring can be either with or without recourse. In case of recourse the factor does not assume the credit risk and it is the company which assumes the credit risk.
2. Factoring is an off balance sheet entry in the sense that both amount of receivables and bank credit are not shown in the balance sheet which is not the case with the bill discounting which is shown in the balance sheet.
3. In bill discounting there is only provision of Source: CoolInterview.com
Question: What factors go into designing the vapor space of kettle type reboiler?

Answer: Lease is a financial contract between the business customer (user) and the equipment supplier (normally owner) for using a particular asset/equipment over a period of time against the periodic payments called ?Lease rentals?.
Hire Purchase is a kind of installment purchase where the businessman (hirer) agrees to pay the cost of the equipment in different installments over a period of time. This installment covers the principal amount and the interest cost towards the purchase of an asset for Source: CoolInterview.com
Question: What is the meaning of Fee Based Financial Services?

Answer: Financial services can be defined as the products and services offered by institutions like banks of various kinds for the facilitation of various financial transactions and other related activities in the world of finance like loans, insurance, credit cards, investment opportunities and money management as well as providing information on the stock market and other issues like market trends. Fee based financial services are those which are paid for a flat fee rather than commission. Source: CoolInterview.com
Question: What is the meaning of Venture Capital?

Answer: Venture capital is financing that investors provide to start up companies and small businesses that are believed to have long-term growth potential. For start ups without access to capital markets, venture capital is an essential source of money. Risk is typically high for investors, but the downside for the start up is that these venture capitalists usually get a say in company decisions.

Source: CoolInterview.com
Question: What is the difference between Mergers and Acquisition?

Answer: A merger occurs when two firms, usually equal in size decide to continue business as a single firm rather than being owned and operate as separate entities. In order for a merger to happen, both companies should surrender their stocks so that a new company can be formed and new stock can be issued.
In an acquisition, one company will purchase the other. In an acquisition, the company that acquires the target company will be entitled to target company?s all the assets, properties, equipment, o Source: CoolInterview.com
Question: State the demerits of Merges and Acquisitions?

Answer: a)Loss of experienced workers aside from workers in leadership positions. This kind of loss inevitably involves loss of business understand and on the other hand that will be worrying to exchange or will exclusively get replaced at nice value.
b)As a result of M&A, employees of the small merging firm may require exhaustive re-skilling.
c)Company will face major difficulties thanks to frictions and internal competition that may occur among the staff of the united companies. There is conjoin Source: CoolInterview.com
Question: State the advantages of Loan Syndication?

Answer: ?Rationalization of your balance sheet
?Securing financing at prevailing market interest rates
?Achieving flexible terms that meet the requirements of your cash flow plan, etc.
?Managing your funds efficiently
?Unifying the terms of transactions with financial institutions
?Securing liquidity
Source: CoolInterview.com
Question: Explain the third law of thermodynamics.

Answer: 1. On the basis of Time
a)Short term loan
b)Long term loan
2. On the basis of secured and unsecured
a)Secured loan
b)unsecured loan
3. On the basis of borrow
a)Open ended loan
b)Closed ended loan Source: CoolInterview.com
Question: What is the meaning of Loan?

Answer: An arrangement in which a lender gives money or property to a borrower, and the borrower agrees to return the property or repay the money, usually along with interest, at some future point in time. Usually, there is a predetermined time for repaying a loan, and generally the lender has to bear the risk that the borrower may not repay a loan. Source: CoolInterview.com
Question: What is the meaning of Forfeiting?

Answer: Method of export trade financing, especially when dealing in capital goods or with high risk countries. In forfeiting, a bank advances cash to an exporter against invoices or promissory notes guaranteed by the importer's bank. The amount advanced is always 'without recourse' to the exporter, and is less than the invoice or note amount as it is discounted by the bank. The discount rates depends on the terms of the invoice/note and the level of the associated risk.

Source: CoolInterview.com

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