money supply, banking & financial institutions section 11 MCQ Questions & Answers Detailed Explanation

MOST IMPORTANT indian economy mcq - 12 EXERCISES

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The following question based on Money Supply, Banking and Financial Institutions topic of indian economy mcq

Questions : Coins are minted in India at

(a) Delhi, Kolkata and Hyderabad

(b) Mumbai, Kolkata and Hyderabad

(c) Mumbai, Delhi and Bengaluru

(d) Delhi, Mumbai and Kolkata

The correct answers to the above question in:

Answer: (b)

Practice Money Supply, Banking and Financial Institutions (money supply, banking & financial institutions section 11) Online Quiz

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Read more money and supply banking financial institutions Based Indian Economy Questions and Answers

Question : 1

Which among the following are the wholly/partly owned subsidiaries of the Reserve Bank of India (RBI)?

  1. Deposit Insurance and Credit Guarantee Corporation (DICGC)
  2. National Housing Bank (NHB)
  3. National Bank for Agriculture and Rural Development (NABARD)
  4. Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL)

a) 1, 2 and 4

b) 1 and 4

c) 2, 3 and 4

d) All of them

Answer: (d)

Question : 2

The most active segment of the Money Market in India is which one of the following?

a) Call Money / Notice Money Market

b) Commercial Paper (CP)

c) Repo / Reverse Repo

d) Certificate of Deposit (CD)

Answer: (a)

Question : 3

Which of the following RBI may do to curb the rupee depreciation:

  1. Allowing importers to directly buy foreign currency from RBI
  2. Increasing the repo rate
  3. Selling dollars in the foreign exchange market
  4. Buying dollars in the foreign exchange market
Select the correct answer using the code given below:

a) (ii) & (iii) only

b) (i), (ii) & (iii) only

c) (i) & (iii) only

d) (i), (ii) & (iv) only

Answer: (b)

The rupee-dollar rate is discovered in the forex market. When importers buy dollars in the foreign exchange market, the rupee depreciates as the demand for dollars increases in the forex market.

But if they directly deal with RBI (and take dollars from RBI) and don’t go into the forex market then it may not impact the rupee-dollar rate.

When RBI increases the repo rate, the interest rate in the market increases which may attract foreign investors in debt instruments resulting in rupee appreciation.

Question : 4

Which of the following statements are correct regarding "Regional Rural Banks (RRBs)":

  1. They are regulated by RBI
  2. They are supervised by NABARD
Select the correct answer using the code given below:

a) only (ii)

b) Both (i) & (ii)

c) only (i)

d) Neither (i) nor (ii)

Answer: (b)

Regional Rural Banks (RRBs) are regulated by RBI and supervised by NABARD

Question : 5

Which of the following ministries/departments identify PSUs for “Strategic Disinvestment”?

a) NITI Aayog

b) Jointly by DIPAM and NITI Aayog

c) Department of Investment and Public Asset Management (DIPAM)

d) Inter-Ministerial body called ‘Alternative Mechanism’

Answer: (b)

Question : 6

Capital market deals with

a) Cash

b) Both long and short term funds

c) Short term fund

d) Long term fund

Answer: (d)

Capital markets are financial markets for the buying and selling of long-term debt or equity-backed securities. These markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making longterm investments.

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