JAIIB · Indian Economy & Indian Financial System · Module D — Financial Products and Services
JAIIB IE&IFS Unit 38 — Venture Capital: Free MCQs with Explanations
By Swarnakshi Jha (ex-banker) · Updated 20 September 2026 · Paper 1 of the November 2026 cycle (1 November 2026)
This page is a free slice of our JAIIB IE&IFS question bank for Unit 38 — Venture Capital (Module D — Financial Products and Services). The Mock Centre holds 49 questions on this unit alone, every one with a why-right / why-wrong explanation; below are the facts examiners keep returning to, five of those questions to try, and the traps that cost marks.
IE&IFS · Module D49 MCQs in the Mock Centre5 free belowPaper on 1 November 2026
Key facts examiners test from this unit
VC = private institutional early-stage investment; high-risk-high-return; largely EQUITY (+ conditional/convertible/conventional loans); earns via capital gains on exit; long-term (short-term goals = the INCORRECT trait); guides but doesn't own-manage.
History: Bhatt Committee 1972 → IFCI's Risk Capital Foundation 1975 → IDBI's Seed Capital Scheme 1976 → Technology Policy Statement 1983 → ICICI's TDICI 1988; 2024 VC inflow ~$13.7 bn.
Stages: EARLY = seed (R&D, low-interest personal loans), start-up, first & second round; LATER = expansion, replacement (buying out exiting shareholders), turn-around (loss revival), buyout (MBO — active buy out passive).
5 free practice questions — tap an option
Five basic questions from this unit. Answers lock on the first tap, exactly as in the exam, and a short explanation opens underneath. The Mock Centre adds the moderate and tough questions, why every other option is wrong, the concept capsule and the exam tip — with your score and revision dates tracked.
Question 1 of 5
Venture Capital is best described as:
Why (a): Venture capital is EARLY-STAGE PRIVATE INVESTMENT — private risk money placed into young, unproven businesses in exchange for a stake, long before banks or stock markets would touch them.
Question 2 of 5
Venture Capital is aptly termed ____ capital:
Why (b): Venture capital is aptly called HIGH-RISK, HIGH-RETURN capital: most start-ups fail, so the few big winners must earn enough to pay for all the losers in the portfolio.
Question 3 of 5
Investors who become financial partners in a venture:
Why (b): Investors who put in capital AND become financial partners in the venture are the VENTURE CAPITALISTS — they share the risk, guide the business and profit only on success.
Question 4 of 5
VC's most distinguishing feature — provided largely as:
Why (b): Venture capital's most distinguishing feature is that it is provided largely as EQUITY — ownership stakes that rise and fall with the venture, not fixed debt claims.
Question 5 of 5
The two broad stage classifications of VC financing:
Why (b): Venture capital financing splits into two broad stage umbrellas: EARLY-STAGE financing (seed, start-up, first/second round) and LATER-STAGE financing (expansion, replacement, turnaround, buyouts).
0 of 5 answered.
Traps in this unit
Confusable A
Confusable B
The difference
Bhatt 1972
Malhotra
VC vs insurance committees
RCF 1975 (IFCI)
Seed Capital 1976 (IDBI)
The first-fund pair
Practise all 49 questions on Unit 38. The free demo opens a slice of every subject with the same explanations; the IE&IFS Online-only pass unlocks all 3,032 IE&IFS questions, the full and module mocks, Smart Revision and the Readiness Score for one year (₹1,299). Not sure where you stand? Take the free 10-question test first.
Independent study aid — not affiliated with, endorsed by, or sponsored by the Indian Institute of Banking & Finance (IIBF). Exam pattern, dates, fees and passing criteria are set by IIBF — always confirm the current rules at iibf.org.in. Regulatory figures verified as of September 2026; verify from official sources before relying on them in practice.
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