BANKING UNIT2

Which of the following is the primary function of a central bank?

• Accepting public deposits

• Issuing currency

• Providing consumer loans

• Selling insurance

The central bank is known as the lender of last resort because:

• It provides loans to individuals

• It assists government in policymaking

• It lends money to commercial banks in times of need

• It prints money for the public

Which of the following is NOT a principle of central banking?

• Monopoly of note issue

• Profit maximization

• Regulation of credit

• Control of inflation

Which institution in India acts as the central bank?

• SBI

• NABARD

• RBI

• SEBI

Credit creation is primarily carried out by:

• Central bank

• Commercial banks

• Cooperative banks

• Regional Rural Banks

Which of the following is a quantitative method of credit control by central bank?

• Margin requirement

• Moral suasion

• Open market operations

• Direct action

A major difference between central banking and commercial banking is:

• Central bank deals with the public

• Commercial bank controls monetary policy

• Central bank issues currency

• Commercial bank regulates inflation

The central bank’s role in managing the nation's currency and interest rates is called:

• Fiscal policy

• Monetary policy

• Budgeting

• Public finance

Which function does NOT belong to a central bank?

• Accepting deposits from the public

• Issuing currency

• Managing foreign exchange reserves

• Regulating commercial banks

Which of the following is a need for central banking?

• To create personal banking schemes

• To earn profit through savings

• To maintain financial stability

• To manage digital banking platforms