MCQ on Money and Banking

MCQ on Money and Banking

Question 1: The Apex bank for providing Agricultural Refinance in India is ___________.

(A) RBI

(B) NABARD

(C) LDB

(D) SBI

View Answer

(B) NABARD

Question 2: NABARD is related with __________.

(A) National Agriculture Development Institution

(B) National Rural Development Institution

(C) National Bank for Agriculture and Rural Development

(D) National Financial Institution

View Answer

(C) National Bank for Agriculture and Rural Development

Question 3: When was the NABARD formed?

(A) 1992

(B) 1982

(C) 1962

(D) 1952

View Answer

(B) 1982

Question 4: Which one of the following links all the ATMs in India?

(A) Indian Bank’s Association

(B) National Securities Depository Limited

(C) National Payments Corporation of India

(D) Reserve Bank of India

View Answer

(C) National Payments Corporation of India

Question 5: Which is the first Private Sector Bank in India to use Software Robotics?

(A) ICICI Bank

(B) HDFC Bank

(C) SBI

(D) UTI Bank

View Answer

(A) ICICI Bank

Question 6: The slogan ‘Pure Banking, Nothing else’ is raised by _________.

(A) ICICI Bank

(B) HDFC Bank

(C) SBI

(D) UTI Bank

View Answer

(C) SBI

Question 7: Narsimhan Committee was related to which of following reforms?

(A) High education reforms

(B) Tax structure reforms

(C) Banking structure reforms

(D) Planning implementation reforms

View Answer

(C) Banking structure reforms

Question 8: Which of the following committee examined and suggested financial sector reforms?

(A) Abid Hussain Committee

(B) Bhagwati Committee

(C) Chelliah Committee

(D) Narsimhan Committee

View Answer

(D) Narsimhan Committee

Question 9:Since the economic reforms were launched in India, which one of the following statements is true for Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CRR) of the commercial banks?

(A) Both SLR and CRR have been raised

(B) SLR has been reduced but CRR has been raised

(C) SLR has been increased but CRR has been reduced

(D) Both SLR and CRR have been reduced

View Answer

(D) Both SLR and CRR have been reduced

Question 10: The Narsimhan Committee for financial sector reforms has suggested reduction in __________.

(A) SLR and CRR

(B) SLR, CRR and Priority Sector Financing

(C) SLR and Financing to Capital goods sector

(D) CRR, Priority Sector Financing and Financing to capital goods sector

View Answer

(B) SLR, CRR and Priority Sector Financing

Question 11: Opening the saving bank account for a minor girl will be called as Economic and Social Development 437 which of the following in Banking terminology?

(A) Retail Banking

(B) Merchant Banking

(C) Social Banking

(D) Corporate Banking

View Answer

(A) Retail Banking

Question 12: Consider the following statements.

  1. The repo rate is the rate at which other banks borrow from the Reserve Bank of India.
  2. A value of ‘0’ for Gini Coefficient in country implies that there is perfectly equal income for everyone in its population.

Which of the statement(s) given above is/are correct?

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) Neither 1 nor 2

View Answer

(C) Both 1 and 2

Question 13: Tarapore Committee was associated with which one of the following? 

(A) Special Economic Zones

(B) Full capital account convertibility

(C) Foreign exchange reserves

(D) Effect of oil prices on the Indian economy

View Answer

(B) Full capital account convertibility

Question 14: The question of full capital account convertibility of Indian was explained by the committee known as _____________.

(A) Vaghul Committee

(B) Rangarajan Committee

(C) Tarapore Committee II

(D) Hashim Committee

View Answer

(C) Tarapore Committee II

Question 15: Study the following statements with regard to Reserve Bank of India and select your answer from the codes given below.

  1. It is the Apex Bank.
  2. It regulates the money supply.
  3. It gives loan to the business houses.
  4. It supervises the operations of NABARD.

Code

(A) 1 and 2

(B) 2 and 4

(C) 1, 2 and 3

(D) 1, 2 and 4

View Answer

(A) 1 and 2

Question 16: Which among the following is a function of the Reserve Bank of India? 

(A)Bank issues the letter of credit to their customers certifying their creditability

(B) Collecting and compilation of statistical information relating to banking and other financial sector

(C) Banks underwrite the securities issued by public or private organisations

(D) Accepting deposits from the public

View Answer

(B) Collecting and compilation of statistical information relating to banking and other financial sector

Question 17: When the Reserve Bank of India was established?

(A) 1920

(B) 1921

(C) 1935

(D) 1940

View Answer

(C) 1935

Question 18: Which of the following Banks is the Central Bank of India?

(A) State Bank of India

(B) Bank of India

(C) Union Bank of India

(D) Reserve Bank of India

View Answer

(D) Reserve Bank of India

Question 19: The headquarters of RBI is situated at ____________.

(A) Delhi

(B) Kolkata

(C) Mumbai

(D) Chennai

View Answer

(C) Mumbai

Question 20: Consider the following statements regarding Reserve Bank of India.

  1. It is a banks to the Central Government.
  2. It formulates and administer monetary policy.
  3. It acts as an agent of government in respect of India.
  4. It handles the borrowing program of Government of India.

Which of these statements are correct? 

(A) 1 and 2

(B) 2, 3 and 4

(C) 1, 2, 3 and 4

(D) 3 and 4

View Answer

(C) 1, 2, 3 and 4

Question 21: Which one of the following statements is not correct?

(A) RBI is the Central Bank of the country

(B) RBI is the banker of the Central and State Government

(C) RBI is the custodian of the country’s Foreign Exchange Reserve

(D) RBI was established in 1949

View Answer

(D) RBI was established in 1949

Question 22: Which of the following is not a function of Reserve Bank of India?

(A) Regulation of currency

(B) Regulation of foreign trade

(C) Regulation of credit

(D) Custody and management of country’s foreign exchange reserved

View Answer

(B) Regulation of foreign trade

Question 23: Who is the ‘lender of the last resort’ in the banking structure of India?

(A) State Bank of India

(B) Reserve Bank of India

(C) Exim Bank of India

(D) Union Bank of India

View Answer

(B) Reserve Bank of India

Question 24: ….. is the official minimum rate at which the Central Bank of a country is prepared to rediscount approved bills held by the commercial banks.

(A) Repo rate

(B) Bank rate

(C) Prime lending rate

(D) Reverse repo rate

View Answer

(B) Bank rate

Question 25: The Bank rate is the rate at which ___________.

(A) a bank lends to the public

(B) the RBI lends to the public

(C) the RBI gives credit to the commercial banks

(D) the Government of India lends to other countries

View Answer

(C) the RBI gives credit to the commercial banks

Question 26: Consider the following statements.

  1. Bank rate is the rate of interest which RBI charges its clients on their short-term borrowing.
  2. Repo rate is the rate of interest which RBI charges its clients on their long-term borrowing.

Which of the statement(s) given above is/are correct?

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) Neither 1 nor 2

View Answer

(D) Neither 1 nor 2

Question 27: The interest rate at which the Reserve Bank of India lends to Commercial Banks in the shortterm to maintain liquidity is known as _____________.

(A) Interest rate

(B) Repo rate

(C) Bank rate

(D) Reverse repo rate

View Answer

(B) Repo rate

Question 28: In order to control credit, Reserve Bank of India should ___________.

(A) increase CRR and decrease Bank rate

(B) decrease CRR and reduce Bank rate

(C) increase CRR and increase Bank rate

(D) reduce CRR and increase Bank rate

View Answer

(C) increase CRR and increase Bank rate

Question 29: In India ‘Money and Credit’ is controlled by the __________.

(A) Central Bank of India

(B) Industrial Development Bank of India

(C) Reserve Bank of India

(D) State Bank of India

View Answer

(C) Reserve Bank of India

Question 30:When the Reserve Bank of India announces an increase of the Cash Reserve Ratio (CRR), what does it mean?

(A) The commercial banks will have less money to lend

(B) The Reserve Bank of India will have less money to lend

(C) The Union Government will have less money to lend

(D) The commercial banks will have more money to lend

View Answer

(A) The commercial banks will have less money to lend