2010 General Studies, all questions
UPSC Prelims 2010 · General Studies
Question 29: Economy and Social Development
In the parlance of financial investments, the term ‘bear’ denotes
aAn investor who feels that the price of a particular security is going to fall
bAn investor who expects the price of particular shares to rise
cA shareholder or a bondholder who has an interest in a company, financial or otherwise
dAny lender whether by making a loan or buying a bond
AnswerThe answer is (a).
In the stock market a bear is an investor who expects prices to fall and so sells, or sells short, hoping to buy back cheaper; a bear market is one with falling prices. A bull is the opposite, expecting prices to rise. Option (b) describes a bull, (c) describes a stakeholder and (d) a creditor. Remember: bear = pessimist on prices; bull = optimist.
Why each option is right or wrong
- (a) Right: a bear expects the price of a security to fall.
- (b) That describes a bull, who expects prices to rise.
- (c) That describes a stakeholder, not a bear.
- (d) That describes a creditor or lender.
Explanation: written by UPSC Grade, not by UPSC.
Source: UPSC, Civil Services (Preliminary) Examination 2010, General Studies, Series A. The paper on upsc.gov.in.