Take your time to read instructions before taking this test.

There are 40 questions which you are to answer in 15 minutes that gives you roughly 30 seconds per question.

If you can get at least 60%, you can be rest assured that you’ll ace FIN 201 exam

In a normal exam you will be asked between 40 – 60 questions but I only arranged 40 questions

Note

Do not be in a hurry to answer the questions

Do not waste time on a question you don’t know

Move as fast as possible and starting with questions that don’t have calculation first to save time

Always crosscheck

Don’t be in a hurry to submit, you are not in a competition

Don’t be scared. Getting an A is easy

Don’t be over confident, you can end up a D, E or F. Calm your blood, no be only you sabi book

Please do well to use our comment box incase there’s a message you want to pass to us

70 – 100 A

60 – 69 B

50 – 59 C

45 – 49 D

40 – 44 E

0 – 39 F

I wish you success

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FIN 201

1 / 40

1. Indicate the tool used by banks to manage financial risks effectively.

A. Automation

B. Reserve fund allocation

C. Employee training

D. Credit policies

2 / 40

2. State the challenge faced by customers due to insufficient bank staff.

A. High-interest rates

B. Lack of branch access

C. Limited product variety

D. Poor service quality

3 / 40

3. Point out the type of reserve maintained by commercial banks due to regulatory requirements.

A. General reserve

B. Voluntary reserve

C. Depreciation reserve

D. Statutory reserve

4 / 40

4. Point out the reason banks impose transaction costs on accounts.

A. Reduce service quality

B. Improve savings habits

C. Cover operational expenses

D. Encourage deposits

5 / 40

5. Identify the component critical to financial intermediation success.

A. Employee redundancy

B. Credit assessment

C. Customer complaints

D. Physical infrastructure

6 / 40

6. Emphasize the feature of banking automation reducing redundancy in human labor.

A. Error detection

B. Staff deployment

C. Process optimization

D. Cost reduction

7 / 40

7. Define the key factor influencing customer demand for banking services.

A. Government policy

B. Technology

C. Income level

D. Marketing strategies

8 / 40

8. Indicate the method banks use to reduce errors in service delivery.

A. Customer feedback

B. Employee training

C. Automation

D. Outsourcing

9 / 40

9. Emphasize the cost banks incur due to automation maintenance.

A. Reduced operational challenges

B. Increased customer satisfaction

C. High infrastructure expenses

D. Reduced employee training costs

10 / 40

10. Identify the output commonly associated with banking operations.

A. Loan and advances

B. Human resources

C. Reserve funds

D. Fixed assets

11 / 40

11. Recognize the theory explaining money creation by the banking system as a whole, not individual banks.

A. Credit creation theory

B. Money multiplier theory

C. Intermediation theory

D. Fractional reserve theory

12 / 40

12. Emphasize the undesirable output in banking operations.

A. Loan-loss provisions

B. Earnings

C. Advances

D. Deposits

13 / 40

13. Mention the key advantage of mergers for smaller banks.

A. Immediate scaling up

B. Declined efficiency

C. Higher operational costs

D. Reduced profitability

14 / 40

14. Emphasize the service banks provide for transferring funds between locations.

A. Fund remittance

B. Payment guarantees

C. Overdrafts

D. Loan advances

15 / 40

15. Define the system ensuring real-time financial transactions without physical bank visits.

A. Centralized banking

B. Manual processing

C. E-banking

D. Traditional banking

16 / 40

16. Highlight the primary cause of credit rationing in banking.

A. Low customer demand

B. Excess funds availability

C. Limited supply of loanable funds

D. Surplus credit availability

17 / 40

17. Specify a disadvantage of banking automation.

A. High acquisition costs

B. Reduced error rates

C. Greater customer satisfaction

D. Increased efficiency

18 / 40

18. Describe the element ensuring banks meet operational challenges

A. Limited credit facilities

B. Advanced technology

C. Manual processing

D. High reserve funds

19 / 40

19. Emphasize the essential source of funds for commercial banks

A. Government bonds

B. Shareholder equity

C. Deposits

D. Loans from other banks

20 / 40

20. Indicate the tool used by banks to manage financial risks effectively

A. Reserve fund allocation

B. Automation

C. Employee training

D. Credit policies

21 / 40

21. Highlight the advantage of online banking for customers.

A. Increased transaction fees

B. Continuous access to services

C. Restricted service hours

D. Limited product offerings

22 / 40

22. Identify the primary reason banks collect reserve funds.

A. Safeguard customer deposits

B. Comply with regulations

C. Increase profitability

D. Enable fund distribution

23 / 40

23. Highlight the component that evaluates the efficiency of resource utilization in banking.

A. Deposit ratio

B. Return on equity

C. Loan approval time

D. Turnaround time

24 / 40

24. Highlight the term describing the process through which banks create new credits when loans are issued.

A. Fractional reserve

B. Credit creation

C. Asset securitization

D. Financial intermediation

25 / 40

25. State the primary factor contributing to economies of scale in banking.

A. Increased production

B. Customer loyalty

C. Cost reduction

D. Technology adoption

26 / 40

26. Mention the factor affecting demand for banking services due to poor accessibility of branches.

A. Income levels

B. Availability of bank branches

C. Transaction costs

D. Service charges

27 / 40

27. Indicate the purpose of statutory reserves for banks.

A. Maximize profits

B. Reduce branch operations

C. Comply with legal requirements

D. Increase loan issuance

28 / 40

28. Define the focus of performance measurement in banking.

A. Customer satisfaction

B. Operational complexity

C. Branch location

D. Staff training

29 / 40

29. Highlight the service enabling banks to attract more customers by offering consultancy.

A. Legal advisory

B. Investment portfolio management

C. Wealth management

D. All the options

30 / 40

30. State the major challenge associated with mergers and acquisitions in banking.

A. Cultural misfit

B. Increased customer base

C. Improved efficiency

D. Better resource utilization

31 / 40

31. Identify the primary role banks play in a market-based economy.

A. Financial intermediation

B. Wealth creation

C. Trade facilitation

D. Tax collection

32 / 40

32. Emphasize the main advantage of branch automation.

A. Enhanced physical infrastructure

B. Improved manual record-keeping

C. Standardization of services

D. Increased human interaction

33 / 40

33. Indicate the advantage customers gain from economies of scale in banking.

A. Higher interest rates

B. Enhanced marketing strategies

C. Limited product variety

D. Reduced costs of services

34 / 40

34. Mention the process banks use to mobilize funds from surplus units to deficit units.

A. Risk diversification

B. Asset management

C. Liquidity creation

D. Financial intermediation

35 / 40

35. Describe the service enabling customers to access funds exceeding their deposits.

A. Fixed deposit

B. Loan advances

C. Credit extension

D. Overdraft

36 / 40

36. State the primary goal of operating costs in banking.

A. Maximizing profit

B. Reducing losses

C. Ensuring day-to-day maintenance

D. Maintaining liquidity

37 / 40

37. Recognize the benefit derived by banks from mergers and acquisitions.

A. Declined financial gains

B. Decreased operational capacity

C. Reduced market presence

D. Enhanced competitive strength

38 / 40

38. Identify the component critical to financial intermediation success

A. Physical infrastructure

B. Customer complaints

C. Credit assessment

D. Employee redundancy

39 / 40

39. Define the key benefit of capital adequacy in banking operations.

A. Enhanced stability

B. Declined operational capacity

C. Reduced competition

D. Limited market reach

40 / 40

40. Highlight a critical metric for measuring bank performance.

A. Product variety

B. Return on assets

C. Turnaround time

D. Market share

Your score is

The average score is 53%

FIN 201 CBT PRACTICE

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