money supply, banking & financial institutions section 9 MCQ Questions & Answers Detailed Explanation

Question : 1

As per the new Monetary Policy Framework, who will determine the inflation target?

a) Reserve Bank of India (RBI)

b) Govt. of India in consultation with RBI

c) Government of India (GoI)

d) Monetary Policy Committee

Question : 2

Which of the following category of financial institutions are not involved in the implementation of Kisan Credit Cards (KCC)?

a) Cooperative Banks

b) Small Finance Banks

c) Regional Rural Banks (RRBs)

d) Non-Banking Financial Institutions (NBFCs)

Question : 3

Consider the following statements regarding the term of appointment of RBI Governor:

a) As fixed by the Central Government while appointing, not exceeding three years and eligible for reappointment

b) As fixed by the Central Government while appointing, not exceeding five years and not eligible for reappointment

c) As fixed by the Central Government while appointing, not exceeding five years and eligible for reappointment

d) As fixed by the Central Government while appointing, not exceeding three years and not eligible for reappointment

Question : 4

What is “narrow money”?

a) The sum of currency in circulation with the public and the cash reserves held by banks

b) The market value of the stocks held by all the holders excluding the promoters

c) The sum of currency in circulation and the demand deposits in banks

d) The sum of MI money and the time deposits

Question : 5

Convertibility of the Rupee as it exists at present means

a) Rupee is convertible into foreign currencies for trade transactions only

b) Rupee is convertible into foreign currencies for capital transactions only

c) Rupee is convertible into foreign currencies for all current transactions only

d) Rupee is convertible into foreign currencies for all types of transactions

Question : 6

Which one of the following statement is correct regarding increase in the cash reserve ratio in India?

a) It reduces credit creation

b) It denotes liberal monetary policy

c) It does not affect credit

d) It increases credit creation