Finance Management (FM) Questions for RBI Grade B Phase 2 Exam
Finance Management (FM) Questions for RBI Grade B Phase 2 Exam

FM Questions for RBI Grade B Phase 2

Attempt Free FM Questions for RBI Grade B Phase 2 exam. RBI Grade B Finance and Management Note PDF. RBI Grade B FM Study Material PDF. RBI Finance and Management (FM) Books, PDF, Previous Papers, Question Set, and study material. As we all know that RBI Grade B Notification 2024 is out. The Reserve Bank of India (RBI) conducted the RBI Grade B Phase I Exam for the post of Grade B (Grade ‘B’ (DR) – (General) & others). It’s the right time when you should start your RBI Grade B Phase 2 preparation at full pace.

If you are preparing for RBI Grade B (Phase 2), you will come across a section on “Finance and Management (FM)” wherein 65 questions will be there carrying 50 marks. Here we are providing you with “Finance and Management (FM) Questions for RBI Grade B” with answers based on the latest pattern of your daily practice.

Finance Management (FM) Questions for RBI Grade B | Test-14

1. Read the given passage and answer the question that follow based on the information mentioned in it.
An appraisal evaluates not only the employees‟ performance but also the potential for development. The primary objectives of an appraisal are to assess part performance, identify training needs, set and agree on future objectives and standard as well as to facilitate the achievement of these goals. Jon Clemens for example argued that the “purpose of reviews should be to drive better business results for the organization making sure that the daily efforts of employees directly contributes to both their team’s goals and the goals of the organization”,(Heskett 2007). McGregor’s Theory X postulates that the average person is lazy and has an inherent dislike for work. As a result of this people must be coerced, controlled, directed and threatened with punishment if the organization is to achieve its objectives. Naturally when people know that their performance is monitored and that their continued existence, promotion, pay rise, training and development are dependent on the results of their assessment, they would be motivated to work hard, (Mullins 2002).
Which of the following statements is false about the behavioral theories of leadership?

  1. Consideration is a people-oriented dimension of leadership behavior
  2. Production-centered leader behavior focuses on tasks and has little concern for people
  3. Leaders high in initiating structure do not set deadlines or make individual task assignments
  4. Employee-centered leader behavior focuses on people and the quality of the social system
  5. None of these

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Correct Answer – C. Leaders high in initiating structure do not set deadlines or make individual task assignments

Explanation: Leaders high in initiating structure do not set deadlines or make individual task assignments

2. Which of the following is a leadership trait?

  1. Dominance
  2. Energy
  3. Cognitive ability
  4. All responses are leadership traits
  5. None of these

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Correct Answer – B. Energy

Explanation: Energy

3. The “means” of leadership involve

  1. Getting results through others
  2. The ability to build cohesive, goal-oriented teams
  3. The process of influencing an organized group toward accomplishing its goals
  4. An interpersonal relation in which others comply because they want to, not because they have to
  5. None of these

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Correct Answer – B. The ability to build cohesive, goal-oriented teams.

Explanation: The ability to build cohesive, goal-oriented teams.

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4. Read the given passage and answer the question(s) that follow.
An investor makes an investment of Rs 50,000 in a chit fund. The investment doubles in 4 years.
Find the annual rate of interest for the given circumstances to be true, considering compound rate of interest.

  1. 15.3%
  2. 18.9%
  3. 8.5%
  4. 13.6%
  5. 4.3%

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Correct Answer: B. 18.9 %

Explanation: The Rule of 69 is used to estimate the amount of time it will take for an investment to double, assuming continuously compounded interest. The calculation is to divide 69 by the rate of return for an investment and then add 0.35 to the result. Doing so yields an approximately correct estimate of the time period required.
According to the question,
If r is the rate of interest (compounded annually).
(69/r) + 0.35= 4
r= 18.9 %

5. Read the given passage and answer the question(s) that follow.
An investor makes an investment of Rs 50,000 in a chit fund. The investment doubles in 4 years.Find the annual rate of interest for the given circumstances to be true, considering simple rate of interest.

  1. 15%
  2. 12%
  3. 8%
  4. 18%
  5. 13%
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Correct Answer: D. 18 %

Explanation:

According to the rule of 72:

Rate required to Double=72/t
t=Length of time
According to question,
If r is the annual rate of interest.
4=(72/r)
r= 18 %

6. Read the given passage and answer the questions that folloe.
Procter & Gamble (P&G) is America’s leading manufacturer of household products (Degen, 2012). It was instituted by William Procter, an Irish candle manufacturer, who launched Procter & Gamble’s operations in 1837 in Cincinnati, Ohio. The general emphasis of the firm is innovation in product development. It is the first manufacturer to conduct direct sales in 1919 and is currently the largest product advertisers. It has over 250 brands of products in the world market. The firm’s core values include leadership, people, ownership, integrity, trust, and passion for winning. Fast development at P&G is enhanced through strategies that promote vitality in business and increases the pace of innovations. The company developed global business units whose purpose is to focus on utilization of technology to develop plans and products. Each new business unit within the global business units are tasked with developing new product brands in specific categories
Procter & Gamble is international company with presence in several countries the overall management is led by the Chief Executive Officer with regional president representing each region. The chart given below refers to the organizational structure of the US unit of Procter & Gamble which is a matrix type of organizational structure.
Who classified strategies into various types?

  1. Michel Porter
  2. George R Terry
  3. Joseph L Massie
  4. Koontz
  5. O’Donnell
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Correct Answer: A. Michel Porter

Explanation: According to Michel Porter, the strategies can be classified into three types. They are:
• Cost leadership strategy
• Differentiation strategy
• Focus strategy
Porter called the generic strategies “Cost Leadership” (no frills), “Differentiation” (creating uniquely desirable products and services) and “Focus” (offering a specialized service in a niche market). He then subdivided the Focus strategy into two parts: “Cost Focus” and “Differentiation Focus.”

4

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7. Read the given passage and answer the questions that folloe.
Procter & Gamble (P&G) is America’s leading manufacturer of household products (Degen, 2012). It was instituted by William Procter, an Irish candle manufacturer, who launched Procter & Gamble’s operations in 1837 in Cincinnati, Ohio. The general emphasis of the firm is innovation in product development. It is the first manufacturer to conduct direct sales in 1919 and is currently the largest product advertisers. It has over 250 brands of products in the world market. The firm’s core values include leadership, people, ownership, integrity, trust, and passion for winning. Fast development at P&G is enhanced through strategies that promote vitality in business and increases the pace of innovations. The company developed global business units whose purpose is to focus on utilization of technology to develop plans and products. Each new business unit within the global business units are tasked with developing new product brands in specific categories
Procter & Gamble is international company with presence in several countries the overall management is led by the Chief Executive Officer with regional president representing each region. The chart given below refers to the organizational structure of the US unit of Procter & Gamble which is a matrix type of organizational structure.
The profession as a financial advisor, comes under?

  1. General staff
  2. Personal staff
  3. Specialized staff
  4. Authorized staff
  5. Line staff
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Correct Answer: A. General staff

Explanation: This basically comes under organizing process in management. And it is classified under formal organization, further under organization structure; we have line and staff authority.
In an organization, the line authority flows from top to bottom and the staff authority is exercised by the specialists over the line managers who advise them on important matters. These specialists stand ready with their specialty to serve line mangers as and when their services are called for, to collect information and to give help which will enable the line officials to carry out their activities better.

Types of Staff:
The staff position established as a measure of support for the line managers may take the following forms:
• Personal Staff: Here the staff official is attached as a personal assistant or adviser to the line manager. For example, Assistant to managing director.
• Specialized Staff: Such staff acts as the fountainhead of expertise in specialized areas like R & D, personnel, accounting etc.
• General Staff: This category of staff consists of a set of experts in different areas who are meant to advise and assist the top management on matters called for expertise. For example, Financial advisor, technical advisor etc.

8. Read the given passage and answer the questions that follow.
Procter & Gamble (P&G) is America’s leading manufacturer of household products (Degen, 2012). It was instituted by William Procter, an Irish candle manufacturer, who launched Procter & Gamble’s operations in 1837 in Cincinnati, Ohio. The general emphasis of the firm is innovation in product development. It is the first manufacturer to conduct direct sales in 1919 and is currently the largest product advertisers. It has over 250 brands of products in the world market. The firm’s core values include leadership, people, ownership, integrity, trust, and passion for winning. Fast development at P&G is enhanced through strategies that promote vitality in business and increases the pace of innovations. The company developed global business units whose purpose is to focus on utilization of technology to develop plans and products. Each new business unit within the global business units are tasked with developing new product brands in specific categories
Procter & Gamble is international company with presence in several countries the overall management is led by the Chief Executive Officer with regional president representing each region. The chart given below refers to the organizational structure of the US unit of Procter & Gamble which is a matrix type of organizational structure.
Target coaching, work planning, mutual goal setting and performance objectives are all terms used to specify concept called?

  1. Behavioral rating approach
  2. Combination method
  3. Management by objective
  4. Critical incident method
  5. Process management method

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Correct Answer: B. Combination method

Explanation: “MBO is a process whereby the superior and the mangers of an organization jointly identify its common goals, define each individual’s major area of responsibility in terms of results expected of him, and use these measures as guides for operating the unit and assessing the contribution of each of its members.”
Features of MBO:
• MBO is concerned with goal setting and planning for individual managers and their units.
• The essence of MBO is a process of joint goal setting between a supervisor and a subordinate.
• Managers work with their subordinates to establish the performance goals that are consistent with their higher organizational objectives.

9. Read the following passage and answer the question(s) that follow.
The government in December set up a Board for Reconstruction of Public Sector Enterprises (BRPSE) to recommend measures for restructuring/reviving Central PSUs referred to them. The BRPSE also recommends cases where disinvestment or closure or sale are justified. BRPSE made recommendations in respect of 58 cases until December 31, 2009. The government has approved proposals for the revival of 37 public sector enterprise and closure of two. Board for reconstruction of public sector enterprises was set up in ________?

  1. 2000
  2. 2001
  3. 2002
  4. 2003
  5. 2004
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Correct Answer: E. 2004

Explanation: The government in December 2004 set up a Board for Reconstruction of Public Sector Enterprises (BRPSE) to recommend measures for restructuring/reviving Central PSUs referred to them. The BRPSE also recommends cases where disinvestment or closure or sale are justified. BRPSE made recommendations in respect of 58 cases until December 31, 2009. The government has approved proposals for the revival of 37 public sector enterprise and closure of two.

10. Read the following passage and answer the question(s) that follow.
The government in December set up a Board for Reconstruction of Public Sector Enterprises (BRPSE) to recommend measures for restructuring/reviving Central PSUs referred to them. The BRPSE also recommends cases where disinvestment or closure or sale are justified. BRPSE made recommendations in respect of 58 cases until December 31, 2009. The government has approved proposals for the revival of 37 public sector enterprise and closure of two.
Which of the following is/are a permanent invitees of BRPSE?

  1. Chairman, Public Enterprises Selection Board (PESB)
  2. Chairman, Oil and Natural Gas Corporation Ltd. (ONGC)
  3. Chairman, Standing Conference of Public Enterprises (SCOPE)
  4. All of the above
  5. None of the above

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Correct Answer: D. All of the above

Explanation: The Board comprises a Chairman, three Non-official Members and three official Members. In addition, Chairman, Public Enterprises Selection Board (PESB), Chairman, Standing Conference of Public Enterprises (SCOPE) and Chairman, Oil and Natural Gas Corporation Ltd. (ONGC) are the permanent invitees. The Secretaries of the Ministry/ Department of those PSEs whose proposals are considered by the Board are invited to attend those Board meetings as Special invitees when the proposals of the PSEs under their administrative control are considered. Chairman, Members, Permanent and Special Invitees on the Board are on part-time basis. The Board has a Secretary in the rank of Additional Secretary to the Government of India.

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Finance & Management (FM) Quizzes For RBI Grade B

Set-20 Set-19 Set-18 Set-17 Set-16
Set-15 Set-14 Set-13 Set-12 Set-11
Set-10 Set-9 Set-8 Set-7 Set-6
Set-5 Set-4 Set-3 Set-2 Set-1

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