Money and Credit

When a person wants to sell exactly what the other person wants to buy. This situation is known as

• Barter System
• Double coincidence of wants
• Trading
• None of these

Which one is an example of Informal Source of Credit

• Banks
• Cooperative Societies
• Money Lender
• All of these

What prevents the poor from getting bank credit?

• absence of collateral
• documentation procedure
• high rate of interest
• none of these

Money can be best described as

• Medium of transaction
• Medium of exchange
• Deposit in Banks
• Payment through cheque

What is the main source of income for banks?

• Interest on loans

• Interest on deposits

• Difference between the interest charged on borrowers and depositors

• None of these

Which one of the following is an asset that the borrower owns and uses as a guarantee until the loan is repaid to the lender?

• Money

• Collateral

• Deposits

Why do banks keep a small proportion of the deposits as cash with themselves?

• To extend loan to the poor

• To extend loan facility

• To pay salary to their staff

• To pay the depositors who might come to withdraw money

An agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment.

• Credit

• Chit fund

• Bank

• Cheque

Goods are directly exchanged without the use of money in this system.

• Cooperative system

• Bank system

• Barter system

• Pascal system

In India, the ________ of India issues currency notes on behalf of the central government

• The Reserve Bank of India

• The Federal Bank of India

• The Central Bank of India

• The World Bank