money supply, banking & financial institutions section 2 MCQ Questions & Answers Detailed Explanation

Question : 1

What does ECS in banking transactions stand for ?

a) Exchange Clearing Standard

b) lectronic Clearing Service

c) Excess Credit Supervisor

d) Extra Cash Status

Question : 2

Which of the following is the largest holder of Government securities?

a) Cooperative Banks

b) Reserve Bank of India

c) Commercial banks

d) Insurance companies

Question : 3

Which among the following are the Nationalised Banks?

1. Bank of India
2. Punjab National Bank
3. Canara Bank
4. United Commercial Bank

a) 3 and 4

b) 1 and 2

c) 1 and 4

d) 1, 2, 3, 4

Question : 4

Debentures and Equity differ in?

a) Debentures are bonds confirming that money has been borrowed; equity is a shareholder’s voting rights in proportion to his shareholding

b) Equity shares have greater risk compared to debentures which have fixed interest on the amount paid.

c) An equity shareholder cannot withdraw his investment but debenture holder can withdraw his money.

d) Both have the right to vote irrespective of the size of their holdings. Debentures are of lower value than equity

Question : 5

Which of the following investors/ agencies can purchase government of India securities/bonds?

1. Reserve Bank of India
2. Portfolio Investors
3. Financial Institution
4. Individuals

a) (i) & (iii) only

b) (iii) only

c) (i) only

d) All of the above

Question : 6

Consider the following actions which the government can take

1. Devaluing the domestic currency.
2. Reduction in the export subsidy.
3. Adopting suitable policies which attract greater FDI and more funds from FIIS.

a) 2 and 3

b) 1 and 3

c) Only 3

d) 1 and 2