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Mahendras has started special quizzes for IBPS |RBI | NABARD & SBI Exam so that you can practice more and more to crack the examination. This IBPS & SBI Exam special quiz series will mold your preparations in the right direction and the regular practice of these quizzes will be really very helpful in scoring good marks in the Examination. Here we are providing you the important question of reasoning ability for the IBPS |RBI | NABARD & SBI Exam.
1-10. Read the following passage carefully and answer the questions given below it. Certain words have been given in bold to help you locate them while answering some question.
The central government has done well to increase the levels of public participation in the share capital of companies listed on stock exchanges. The threshold level of public holding has been raised to 25 per cent from 10 per cent. Companies that fall short of this minimum have been asked to comply within a time frame by adding to the public holding at least 5 per cent every year. As for the new issuers of capital, some leeway in the time frame has been given to those who will have very large share valuations after the issue. The idea clearly is to help a company sell its shares in a gradual manner without fear of depressing the share prices during the initial offer. In fact, the main objective of the new guidelines is to strike a fresh balance between the relative shares of the promoters and the public.
Until the early 1990s, capital market rules were tilted in favour of the public. Promoters were not permitted to earmark for themselves more than 40 per cent of a new share issue. A few exemptions were allowed, as for example when there was a financial collaboration with a State government development institution. However, early in the era of liberalisation, pressure came from several directions to alter the listing rules to give promoters a larger share. Technology companies that had a limited presence in the stock markets and were, unlike today, hardly favoured by investors lobbied for a smaller public share. The idea was to ensure attractive valuation for their shares, which were later used as 'currency' for acquisitions and expansion. It was also argued that a lower public share would reduce the issue expenses, a line of thinking that found wider support when even the relatively small public shares were split among retail investors, high net worth individuals, and so on. However, the lower reservation for the public, which was brought down in stages to 10 per cent, encouraged collusive practices in several cases, leading to artificially high share prices. Liquidity has suffered and, as the government has now realised, a high percentage of floating stock is necessary for discovering a fair price. As a result of the revised guideline, very large share offerings estimated between Rs.160,000 crore and Rs.210,000 crore — a sizable portion by public sector enterprises — are expected soon. All these, however, do not guarantee a better deal for the small investor. Stock market reform may have brought substantial benefits to the capital market. But, as this year's round of public sector disinvestment shows, retail investors remain disgruntled and alienated.
1 For what a high percentage of floating stock is required?
01. Discovering a fair price
02. Stock market
03. Technology companies
04. Promoters
05. The central government
2 As a result of the revised guideline, very large share offerings estimated-
01. between Rs.190,000 crore and Rs.210,000 crore
02. between Rs.170,000 crore and Rs.210,000 crore
03. between Rs.180,000 crore and Rs.210,000 crore
04. between Rs.160,000 crore and Rs.210,000 crore
05. between Rs.150,000 crore and Rs.210,000 crore
3 Early in the era of liberalisation, pressure came from several directions to-
01. To strike a fresh balance between the relative shares of the promoters and the public
02. To strike a fresh balance between the relative shares of the promoters and the government
03. Alter the listing rules to give promoters a larger share
04. Alter the listing rules to give government a larger share
05. Help in the capital market
4 What is the main objective of the new guidelines?
01. To strike a fresh balance between the relative shares of the promoters and the public
02. To ensure attractive valuation for their shares between the relative shares of the promoters and the government
03. To alter the listing rules between the relative shares of the promoters and the public
04. To help a company sell its shares between the relative shares of the promoters and the government
05. To comply within a time frame between the relative shares of the promoters
5 Which of the following statement is NOT TRUE according to the passage?
01. Until the early 1990s, capital market rules were tilted in favour of the public.
02. A few exemptions were allowed, as for example when there was a financial collaboration with a State government development institution.
03. The idea was to ensure attractive valuation for their shares, which were later used as 'currency' for acquisitions and expansion.
04. Liquidity has suffered and, as the government has now realised, a high percentage of floating stock is necessary for discovering a fair price.
05. In fact, the main objective of the new guidelines is to strike a fresh balance between the relative shares of the promoters and the government.
6 Which of the following statement is TRUE according to the passage?
(A) The idea clearly is to help a company sell its shares in a gradual manner without fear of depressing the share prices during the initial offer.
(B) The threshold level of public holding has been raised to 15 per cent from 10 per cent.
(C) As for the new issuers of capital, some leeway in the time frame has been given to those who will have very large share valuations after the issue.
01. Only A and B
02. Only B and C
03. Only A and C
04. All A, B and C
05. Only B
7 Choose the word most SIMILAR in meaning to the word given in bold, as used in the passage.
Disinvestment
01. Privation
02. Viability
03. Commensurate
04. Dormant
05. Perception
8 Choose the word most SIMILAR in meaning to the word given in bold, as used in the passage.
Collusive
01. Coincide
02. Hook
03. Ubiquitous
04. Prerequisite
05. Conniving
9 Choose the word which is most nearly the OPPOSITE in meaning as the word given in bold as used in the passage.
Acquisitions
01. Solitude
02. Quintessential
03. Emaciated
04. Dearth
05. Pertinent
10 Choose the word which is most nearly the OPPOSITE in meaning as the word given in bold as used in the passage.
Collaboration
01. Profound
02. Separation
03. Sophisticated
04. Entail
05. Sanity
Answers:-
Q.1 (1)
Q.2 (4)
Q.3 (3)
Q.4 (1)
Q.5 (5)
Q.6 (3)
Q.7 (1)
Q.8 (5)
Q.9 (4)
Q.10 (2)
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