MCQ Bank

ABC Company issues 5 year bonds having following characteristics:
Rs. 1,000 face value, initial price Rs. 497 and yield to maturity is 15%.
Bonds issued by ABC Company falls under which one of the following type of bonds?

A) Convertible bonds
B) Floating-rate bonds
C) Zero coupon bonds
D) Government bonds

AI Explanation

A zero-coupon bond makes no periodic coupon payments and is issued at a substantial discount to its face value. The Rs. 497 issue price relative to the Rs. 1,000 face value is consistent with this structure.

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Q240

Which of the following is an example of positive covenant?

A) Restricting pledging assets to other lenders
B) Barring merger with another firm
C) Limiting the amount of dividend according to some formula
D) Maintaining any collateral or security in good condition

AI Explanation

A positive covenant requires the borrower to take specified actions, such as maintaining collateral in good condition. The other choices restrict actions the borrower may take and are therefore negative covenants.

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Q241

Which of the following is NOT included in a bond indenture?

A) A description of the security
B) The total amount of bonds issued
C) A personal profile of the issuer
D) The basic terms of bond issue

AI Explanation

A bond indenture contains the basic terms of the bond issue, including the amount issued and security provisions. A personal profile of the issuer is not a standard component of a bond indenture.

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Q242

Which of the following is NOT a determinant of term structure?

A) Internal rate of interest
B) Real rate of interest
C) Interest rate risk
D) Expected inflation

AI Explanation

The term structure of interest rates is influenced by factors such as the real rate of interest, expected inflation, and interest-rate risk. Internal rate of interest is not a standard determinant of the term structure.

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Q243

Which of the following bond allows the holder to force the issuer to buy the bond back at a stated price?

A) Convertible bond
B) Zero-coupon bond
C) Put bond
D) Income Bond

AI Explanation

A put bond gives the bondholder the right to require the issuer to repurchase the bond at a specified price. This differs from a callable bond, where the issuer has the right to repurchase the bond.

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Q244

A ______ covenant limits or prohibits actions that company might take.

A) Neutral
B) None of the given options
C) Negative
D) Positive

AI Explanation

A negative covenant restricts or prohibits actions that a company may take, such as taking on additional debt or selling assets. Positive covenants instead require the company to perform specified actions.

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Q245

While calculating the present value of bond, which of the following rate is used for discounting purpose?

A) You can use either coupon rate or market rate
B) Market required rate
C) Coupon Rate
D) Use that rate which is lower of both (coupon and market rate)

AI Explanation

The present value of a bond is calculated by discounting its future cash flows at the market's required rate of return. The coupon rate determines the coupon payment but not the appropriate discount rate.

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Q246

Which of the following bond can be swapped for a fixed number of shares at any time before maturity at the holder’s option?

A) Zero-coupon bond
B) Put bond
C) Income Bond
D) Convertible bond

AI Explanation

A convertible bond gives the holder the option to exchange the bond for a specified number of shares of the issuing company. This conversion right can generally be exercised according to the terms of the bond before maturity.

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Q247

Which one of the following statements is INCORRECT regarding Bond Price Theorems?

A) When the market’s required return of a bond is greater than the coupon rate, the bond’s market value will be greater than its par value.
B) When the market’s required return of a bond is less than the coupon rate, the bond’s market value will be greater than its par value.
C) When a bond’s coupon rate is greater than the market’s required return, the bond’s market value will be greater than its par value.
D) Bond prices and market interest rates move in the opposite directions.

AI Explanation

This statement is incorrect because when the required return exceeds the coupon rate, the bond sells below par value at a discount. A bond sells above par when its coupon rate is greater than the market's required return.

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The primary input required for homology modeling is

A) Protein sequence
B) Protein expression level
C) Protein function
D) Protein structure

AI Explanation

Homology modeling primarily requires the amino acid sequence of the target protein. This sequence is compared with known structures of homologous proteins to build a model.

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MEDLINE is the primary resource for biomedical journal articles and millions of citations to articles in biomedical journals can be found here.

A) True
B) False
C)
D)

AI Explanation

MEDLINE is a major bibliographic database for biomedical literature. It provides citations and abstracts from millions of articles in biomedical and life-science journals.

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Which software tool is commonly used for homology modeling?

A) SPSS
B) PyMOL
C) MODELLER
D) BLAST

AI Explanation

MODELLER is a widely used software package for comparative or homology modeling of protein three-dimensional structures. It builds a model based on known structures of related proteins.

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------------is the databases that stores the genome of fruit-fly Drosophila

A) None of the above
B) FlyBase
C) Graphics
D) Genebank

AI Explanation

FlyBase is a major database dedicated to the genetics and genomics of Drosophila species, especially the fruit fly Drosophila melanogaster. It stores and provides access to extensive genomic and genetic information.

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For simple sequences (not related with down-stream analysis) and annotations and can be submitted through web (if the datasets are small) which does not requires any advanced tools.

A) NCBI
B) BANKIt
C) UniProt
D) None

AI Explanation

BANKIt is a web-based submission tool used to submit relatively simple nucleotide sequence datasets and their annotations to GenBank. It is suitable for smaller datasets that do not require advanced submission tools.

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------------comprises of more than 24 million citations for biomedical literature from MEDLINE, life science journals, and online books.

A) PUBMED
B) CINAHL
C) PsycoINFO
D) MEDLINE

AI Explanation

PubMed comprises more than 24 million citations for biomedical literature, including MEDLINE, life science journals, and online books. It is a widely used database for searching biomedical research.

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Sequences are submitted to the databases in order to share them with the scientific community (sometimes they are also required by the Publication and funding agencies to submit them).

A) False
B) True
C)
D)

AI Explanation

Sequences are submitted to databases to make them available to the scientific community. Submission may also be required by journals or funding agencies as part of publication or research requirements.

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Homology modeling is less accurate when:

A) The target protein has high expression levels
B) The target and template proteins have low sequence similarity
C) The target protein has a known structure
D) The template protein has a different fold than the target protein

AI Explanation

Homology modeling relies on similarity between the target and template sequences. Low sequence similarity makes it harder to accurately infer the target protein's three-dimensional structure.

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The accuracy of homology models depends on

A) Length of the target protein sequence
B) Sequence similarity between target and template proteins
C) Resolution of the template protein structure
D) Availability of experimental data

AI Explanation

The accuracy of homology modeling strongly depends on how similar the target and template protein sequences are. Higher sequence similarity generally leads to a more reliable structural model.

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PDB is a good resource to get the

A) Nucleotide structure
B) RNA structure
C) Protein structure
D) DNA structure

AI Explanation

The Protein Data Bank (PDB) is a major repository of experimentally determined three-dimensional structures of proteins and other biological macromolecules. It is particularly well known as a resource for protein structures.

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Q10

PUBMED comprises of more than 24 million citations for biomedical literature from MEDLINE, life science journals, and online books.

A) True
B) False
C)
D)

AI Explanation

PubMed is a major resource for biomedical literature and includes citations from MEDLINE, life-science journals, and online books. It is widely used for searching biomedical research publications.