12th Money & Banking MCQ Test-2

Which of the following is a step that the central bank will take to encourage greater investment in the economy?

• It will look to increase the cash reserve ratio

• It will look to reduce the cash reserve ratio

• It will look to increase the bank rate

• It will look to sell the government securities in the open market

Which of the following is a step that the central bank will take to increase the overall availability of credit?

• It will sell the government securities in the market

• It will buy more government securities from the market

• It will raise the reverse repo rate

• It will raise the repo rate

Which of the following statements is true about the central bank?

• It regulates the entire banking system in the country

• It is under the ownership of the central government of a country

• It is the apex bank of a country

• All of the above

Which of the following statements is true about demand deposits?

• It includes both fixed deposits and current account deposits

• It includes both savings account deposits and fixed deposits

• It includes both current account deposits and savings account deposits

• It includes fixed deposits, current account deposits and savings account deposits

Which of the statements gives an accurate picture of the effect of the increase in the repo rate?

• The money supply in the country will decrease

• The money supply in the country will increase

• The money supply in the country will increase initially and then decrease

• There is no effect on the money supply in the country

Which agency regulates the money supply in India?

• The Government of India

• Commercial banks

• Reserve Bank of India

• None of the above

Which of the following is not the function of the central bank of a country?

• Being the custodian of foreign exchange reserves

• Accepting deposits from the general public

• Both a and b are correct

• Both a and b are incorrect

Barter System exist in which economy?

• B-B

• B-C

• C-C

• C-B

Money which is issued by government & has legal tender is known as?

• Fudiaciary Money

• Flute Money

• Famine Money

• Fiat Money

M1 does not includes?

• Currency held with public

• Demand Deposit with Banks

• Demand Deposits with RBI

• Other deposits with RBI