JAIIB Paper 2 Module B Quiz 2

Correct answer: A revolving working-capital facility subject to limit and drawing power. Cash credit finances working capital and drawings are constrained by sanctioned limit and drawing power. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A revolving working-capital facility subject to limit and drawing power. Cash credit finances working capital and drawings are constrained by sanctioned limit and drawing power. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A revolving working-capital facility subject to limit and drawing power. Cash credit finances working capital and drawings are constrained by sanctioned limit and drawing power. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A revolving working-capital facility subject to limit and drawing power. Cash credit finances working capital and drawings are constrained by sanctioned limit and drawing power. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A revolving working-capital facility subject to limit and drawing power. Cash credit finances working capital and drawings are constrained by sanctioned limit and drawing power. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility allowing drawings beyond credit balance up to an approved limit. An overdraft is a fund-based credit facility governed by an approved limit and terms. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility allowing drawings beyond credit balance up to an approved limit. An overdraft is a fund-based credit facility governed by an approved limit and terms. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility allowing drawings beyond credit balance up to an approved limit. An overdraft is a fund-based credit facility governed by an approved limit and terms. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility allowing drawings beyond credit balance up to an approved limit. An overdraft is a fund-based credit facility governed by an approved limit and terms. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility allowing drawings beyond credit balance up to an approved limit. An overdraft is a fund-based credit facility governed by an approved limit and terms. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility with a defined tenor and repayment schedule. Term loans are repaid over an agreed period, often through instalments. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility with a defined tenor and repayment schedule. Term loans are repaid over an agreed period, often through instalments. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility with a defined tenor and repayment schedule. Term loans are repaid over an agreed period, often through instalments. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility with a defined tenor and repayment schedule. Term loans are repaid over an agreed period, often through instalments. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A facility with a defined tenor and repayment schedule. Term loans are repaid over an agreed period, often through instalments. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A contingent undertaking to pay under the guarantee‘s terms. A guarantee is generally contingent; payment depends on the instrument‘s terms and a valid claim. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A contingent undertaking to pay under the guarantee‘s terms. A guarantee is generally contingent; payment depends on the instrument‘s terms and a valid claim. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A contingent undertaking to pay under the guarantee‘s terms. A guarantee is generally contingent; payment depends on the instrument‘s terms and a valid claim. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A contingent undertaking to pay under the guarantee‘s terms. A guarantee is generally contingent; payment depends on the instrument‘s terms and a valid claim. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.

Correct answer: A contingent undertaking to pay under the guarantee‘s terms. A guarantee is generally contingent; payment depends on the instrument‘s terms and a valid claim. The distractors are incorrect because they conflict with the applicable lending, legal, risk-management or operational principle. In practice, officers should also check the latest RBI directions, the relevant statute and their bank‘s current approved policy.