McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Economics (CBCS) .
Chapters
| 1. |
Which of the following is a commercial bank? |
| A. | State Bank of India |
| B. | Unit Trust of India (UTI |
| C. | IDBI |
| D. | NABARD |
| Answer» A. State Bank of India | |
| 2. |
Which one of the following is near money? |
| A. | Treasury Bills |
| B. | Bills of Exchange |
| C. | Bonds and Debentures |
| D. | All of the above |
| Answer» D. All of the above | |
| 3. |
In July 1969, 14 major Indian scheduled banks were nationalised and 6 more banks were nationalised in |
| A. | April 1980 |
| B. | May 1980 |
| C. | April 1981 |
| D. | May 1981 |
| Answer» A. April 1980 | |
| 4. |
The liabilities of a bank are |
| A. | Advance and loans |
| B. | Time deposits and shares |
| C. | Cash with reserve ratio |
| D. | Bonds and debentures of share holders |
| Answer» B. Time deposits and shares | |
| 5. |
The recent conversion of Financial Institutions into Commercial Banks or Non-Banking Finance Companies (NBFCs) under the regulatory aspect of RBI was suggested by |
| A. | Narasimham Committee |
| B. | Ministry of Company Affairs |
| C. | Ministry of Finance |
| D. | None of the above |
| Answer» A. Narasimham Committee | |
| 6. |
Which property the paper money does not possess |
| A. | Acceptability |
| B. | Divisibility |
| C. | Duality |
| D. | Portability |
| Answer» C. Duality | |
| 7. |
Rupee is a coin |
| A. | Full Value |
| B. | Token money |
| C. | Credit money |
| D. | Convertible |
| Answer» B. Token money | |
| 8. |
Which one of the following is not included in the function of money |
| A. | Make demand and supply |
| B. | Store of value |
| C. | Medium of exchange |
| D. | Measure of value |
| Answer» A. Make demand and supply | |
| 9. |
Convertible money means |
| A. | It can buy means |
| B. | Government can give gold against it |
| C. | Illegal money |
| D. | Low value of money |
| Answer» B. Government can give gold against it | |
| 10. |
Commercial banks create |
| A. | Credit money |
| B. | Token money |
| C. | Legal money |
| D. | Do not create money |
| Answer» A. Credit money | |
| 11. |
The most important features of money is |
| A. | General acceptability |
| B. | Convertibility into gold |
| C. | Store of value |
| D. | Medium of exchange |
| Answer» A. General acceptability | |
| 12. |
Which movement encourage the formation of commercial banks |
| A. | Swadeshi movement |
| B. | Quit India movement |
| C. | Non-cooperation movement |
| D. | Civil disobedience movement |
| Answer» A. Swadeshi movement | |
| 13. |
In which year was the Banking Regulation Act passed? |
| A. | 1949 |
| B. | 1955 |
| C. | 1959 |
| D. | 1969 |
| Answer» A. 1949 | |
| 14. |
What is the most widely used tool of monetary policy? |
| A. | Issuing of notes |
| B. | Open market operation |
| C. | Discount rate |
| D. | None of the above |
| Answer» C. Discount rate | |
| 15. |
Banking sector comes under which of the following sectors? |
| A. | Manufacturing sectors |
| B. | Industrial sectors |
| C. | Service sectors |
| D. | None of the above |
| Answer» C. Service sectors | |
| 16. |
Who is responsible for the supply of coins in India? |
| A. | Reserve bank of India |
| B. | Ministry of finance |
| C. | Ministry of commerce and industry |
| D. | Bankers association of India |
| Answer» B. Ministry of finance | |
| 17. |
Difference between total receipt and total expenditure is |
| A. | Capital deficit |
| B. | budget deficit |
| C. | fiscal deficit |
| D. | Revenue deficit |
| Answer» B. budget deficit | |
| 18. |
The commercial banks in India are governed by |
| A. | Reserve bank of India Act 1934 |
| B. | Indian Companies Act 1956 |
| C. | Indian Banking Regulation Act 1949 |
| D. | Securities and Exchange Board of Indian Act 1993 |
| Answer» C. Indian Banking Regulation Act 1949 | |
| 19. |
Which of the following limits the power of credit creation by commercial bank |
| A. | Fiscal policy |
| B. | Banking loan |
| C. | Business possession |
| D. | None of the above |
| Answer» D. None of the above | |
| 20. |
Deposits which arise from granting of loans are called |
| A. | primary deposits |
| B. | derivative deposits |
| C. | fixed deposits |
| D. | All the above |
| Answer» B. derivative deposits | |
| 21. |
Which among the following is considered to be the most liquid asset? |
| A. | Gold |
| B. | Money |
| C. | Land |
| D. | Treasury bonds |
| Answer» B. Money | |
| 22. |
The first financial institution set up in India |
| A. | IDBI |
| B. | ICICI |
| C. | IRBI |
| D. | IFCI |
| Answer» D. IFCI | |
| 23. |
In order to control credit and investment , the central bank of a country should |
| A. | Sell securities in the open market and hike the cash reserve ratio |
| B. | Buy securities in the open market |
| C. | Buy securities from the open market and hike the cash reserve ratio |
| D. | Sell securities in the open market |
| Answer» A. Sell securities in the open market and hike the cash reserve ratio | |
| 24. |
Which one of the following is not an instrument of credit control in the banking system? |
| A. | Open market operation |
| B. | Cash Reserve ratio |
| C. | Tax rate |
| D. | Bonds and debentures |
| Answer» C. Tax rate | |
| 25. |
The commercial bank do not perform one function out of the following |
| A. | Mobilization of saving |
| B. | Giving loans and advances |
| C. | Issues currency notes |
| D. | Financing priority sectors |
| Answer» C. Issues currency notes | |
| 26. |
Credit creation power of the commercial banks gets limited by which of the following? |
| A. | Banking habits of the people |
| B. | Cash reserve ratio |
| C. | Credit policy of the Central bank |
| D. | All the above |
| Answer» D. All the above | |
| 27. |
Number of times a unit of money change hands in the course of a year is called |
| A. | Supply of money |
| B. | Purchasing power of money |
| C. | Velocity of money |
| D. | value of money |
| Answer» C. Velocity of money | |
| 28. |
Assets – liability = |
| A. | Profit |
| B. | Working capital |
| C. | Capital |
| D. | Long term liability |
| Answer» C. Capital | |
| 29. |
The assets can be convert into cash within a short period like one year or less are known as |
| A. | Current asset |
| B. | Fixed asset |
| C. | Tangible asset |
| D. | Investment |
| Answer» A. Current asset | |
| 30. |
Debentures is also name as |
| A. | share |
| B. | Bond |
| C. | Equity |
| D. | Reserve |
| Answer» B. Bond | |
| 31. |
A bills of exchange when drawn requires |
| A. | Nothing |
| B. | Discounting |
| C. | Acceptance |
| D. | Investment |
| Answer» C. Acceptance | |
| 32. |
The following is not a type of liability |
| A. | Short term |
| B. | Current |
| C. | Fixed |
| D. | Contingent |
| Answer» A. Short term | |
| 33. |
Whichof the following is most liquid measure of money supply in India |
| A. | M1 |
| B. | M2 |
| C. | M3 |
| D. | M4 |
| Answer» A. M1 | |
| 34. |
Which of the following money supply is used by RBI? |
| A. | Currency notes |
| B. | Coins |
| C. | Both A &B |
| D. | None of the above |
| Answer» A. Currency notes | |
| 35. |
The term ‘bank liquidity’ means |
| A. | Its capacity to create credit |
| B. | Its capacity to provide a high rate of interest |
| C. | Its capacity to convert its assets into cash |
| D. | None of the above |
| Answer» C. Its capacity to convert its assets into cash | |
| 36. |
Accounting equation is base of |
| A. | Single entry system |
| B. | Dual concept |
| C. | Double entry system |
| D. | Costing measurement system |
| Answer» C. Double entry system | |
| 37. |
Anything used as money must be |
| A. | Fixed in value |
| B. | Fixed in supply |
| C. | Legal tender |
| D. | Readily acceptable |
| Answer» D. Readily acceptable | |
| 38. |
Which of the following can change money supply |
| A. | National Assembly |
| B. | Supreme Court |
| C. | Government |
| D. | State Bank |
| Answer» D. State Bank | |
| 39. |
Which of the following increase money supply in the country? |
| A. | Purchase of bonds by State Bank |
| B. | Sale of bonds by State Bank |
| C. | Increase in discount rate |
| D. | Decrease in taxes |
| Answer» A. Purchase of bonds by State Bank | |
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