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Securities and Exchange Board of India Act, 1992

Description: Securities and Exchange Board of India Act, 1992 Quiz
Number of Questions: 15
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Tags: indian law banking and finance law sebi act
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When was the Securities and Exchange Board of India (SEBI) Act enacted?

  1. 1990

  2. 1991

  3. 1992

  4. 1993


Correct Option: C
Explanation:

The SEBI Act was enacted in 1992 to regulate the securities market in India.

What is the primary objective of the SEBI Act?

  1. To protect the interests of investors in securities

  2. To promote the development of the securities market

  3. To regulate the activities of stock exchanges

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act has multiple objectives, including protecting investors, promoting market development, and regulating stock exchanges.

Which body is responsible for administering the SEBI Act?

  1. Ministry of Finance

  2. Reserve Bank of India

  3. Securities and Exchange Board of India

  4. National Stock Exchange


Correct Option: C
Explanation:

The SEBI Act is administered by the Securities and Exchange Board of India (SEBI).

What are the powers of SEBI under the SEBI Act?

  1. To register and regulate stock exchanges

  2. To regulate the issue of capital by companies

  3. To investigate and prosecute offenses under the Act

  4. All of the above


Correct Option: D
Explanation:

SEBI has wide-ranging powers under the Act, including the ability to register and regulate stock exchanges, regulate capital issuance, and investigate and prosecute offenses.

What is the penalty for violating the SEBI Act?

  1. Fine

  2. Imprisonment

  3. Both fine and imprisonment

  4. None of the above


Correct Option: C
Explanation:

Violating the SEBI Act can result in both fines and imprisonment.

What is the role of SEBI in regulating insider trading?

  1. To prohibit insider trading

  2. To investigate and prosecute cases of insider trading

  3. To create a regulatory framework to prevent insider trading

  4. All of the above


Correct Option: D
Explanation:

SEBI plays a crucial role in regulating insider trading by prohibiting it, investigating and prosecuting cases, and creating a regulatory framework to prevent it.

What is the significance of the SEBI Act in the Indian financial market?

  1. It provides a legal framework for regulating the securities market

  2. It protects the interests of investors and promotes market integrity

  3. It facilitates the growth and development of the securities market

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act is significant as it provides a legal framework, protects investors, promotes market integrity, and facilitates market growth.

How does the SEBI Act contribute to the prevention of fraud and manipulation in the securities market?

  1. By regulating the activities of market participants

  2. By enforcing disclosure requirements

  3. By conducting investigations and taking enforcement actions

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act contributes to fraud and manipulation prevention through regulation, disclosure requirements, and enforcement actions.

What is the role of SEBI in promoting investor education and awareness?

  1. To conduct investor education programs

  2. To provide information and resources to investors

  3. To collaborate with other stakeholders to enhance investor awareness

  4. All of the above


Correct Option: D
Explanation:

SEBI plays a multifaceted role in promoting investor education and awareness through programs, information provision, and collaboration.

How does the SEBI Act promote the development of the securities market in India?

  1. By creating a conducive regulatory environment

  2. By facilitating the entry of new participants

  3. By encouraging innovation and technological advancements

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act promotes market development by creating a favorable regulatory environment, facilitating new entrants, and encouraging innovation.

What is the composition of the SEBI board?

  1. Chairperson

  2. Members from various backgrounds

  3. Government representatives

  4. All of the above


Correct Option: D
Explanation:

The SEBI board comprises a Chairperson, members from diverse backgrounds, and government representatives.

What is the tenure of the SEBI Chairperson?

  1. 3 years

  2. 5 years

  3. 7 years

  4. 10 years


Correct Option: B
Explanation:

The tenure of the SEBI Chairperson is 5 years.

What are the functions of the SEBI board?

  1. To formulate policies and regulations

  2. To approve the budget and annual report

  3. To appoint key officials

  4. All of the above


Correct Option: D
Explanation:

The SEBI board performs various functions, including policy formulation, budget approval, annual report approval, and key official appointments.

How does the SEBI Act contribute to the protection of investors' rights?

  1. By ensuring transparency and disclosure in the securities market

  2. By providing a grievance redressal mechanism

  3. By promoting fair and ethical market practices

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act protects investors' rights by ensuring transparency, providing a grievance redressal mechanism, and promoting fair market practices.

What is the significance of the SEBI Act in the context of corporate governance?

  1. It promotes transparency and accountability in corporate governance

  2. It enhances the role of independent directors

  3. It strengthens the regulatory oversight of corporate governance practices

  4. All of the above


Correct Option: D
Explanation:

The SEBI Act plays a crucial role in promoting transparency, accountability, and the role of independent directors in corporate governance.

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