money supply, banking & financial institutions section 2 Practice Questions Answers Test with Solutions & More Shortcuts
Money Supply, Banking and Financial Institutions PRACTICE TEST [12 - EXERCISES]
money supply, banking & financial institutions section 1
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money supply, banking & financial institutions section 11
money supply, banking & financial institutions section 12
Question : 46
Which of the following statements are true regarding India’s present exchange rate system:
- The rupee-dollar rate depends on market forces of demand & supply
- RBI regulates the Rupee dollar rate
- RBI intervenes in the forex market
- RBI regulates the forex market
a) (i) & (iii) only
b) (i), (iii) & (iv) only
c) (i) only
d) (ii) & (iii)
Answer »Answer: (b)
The rate of rupee-dollar is determined in the forex market based on market forces of demand and supply. When the rupee becomes highly volatile, then RBI intervenes in the forex market, to contain the volatility.
But RBI does not regulate or fix the rupee-dollar rate. This is called ‘Managed Float’ or ‘Dirt Float’.
RBI regulates the Forex Market, Money Market and Govt. securities Market.
Question : 47 [UPSC (Pre) 2011]
Consider the following actions which the government can take
- Devaluing the domestic currency.
- Reduction in the export subsidy.
- 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
Answer »Answer: (b)
Question : 48
Which of the following investors/ agencies can purchase government of India securities/bonds?
- Reserve Bank of India
- Portfolio Investors
- Financial Institution
- Individuals
a) (i) & (iii) only
b) (iii) only
c) (i) only
d) All of the above
Answer »Answer: (d)
Question : 49
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
Answer »Answer: (a)
Question : 50
Consider the following steps:
- Banking Department gets currency from the Issue Department
- Government puts the currency in circulation
- Central Government incurs a deficit in its Budget
- Government Sells Treasury Bills to Banking Department of RBI
a) 2 3 4 1
b) 1 2 3 4
c) 3 4 1 2
d) 4 3 2 1
Answer »Answer: (c)
IMPORTANT indian economy mcq EXERCISES
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500+ Banking & Money Supply GK MCQ Quiz PDF For IBPS Exam »
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Top 500+ Indian Financial System GK MCQ Live Quiz For SSC »
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New Banking & Financial Institutions GK MCQ Quiz For RRB »
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Top 500+ Money Supply Methods & Concepts GK MCQ For UPSC »
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Banking & Financial Institutions Features GK MCQ Quiz PDF »
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New 500+ Money Supply Concepts Types Formulas GK MCQ Quiz »
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499+ Indian Monetary Aggregates & Money Supply GK MCQ PDF »
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Top 500+ Money & Banking Questions And Answers Test PDF »
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New Banking & Money Supply Questions And Answers Test PDF »
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Top 500+ Money Supply Trends & Developments MCQ For IBPS »
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Top 500+ Banking & Financial Institutions GK MCQ Test PDF »
Money Supply, Banking and Financial Institutions Shortcuts »
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indian economy MCQ CATEGORIES
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» Introduction to Indian Economy
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» Planning, Economic Development & Five year Plans
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» National Income & Human Development Index
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» Agriculture Sector, Subsidy and Food Processing
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» Industries, Manufacturing & Service Sectors
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» Inclusive growth, Sustainable development and employment
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» Poverty & Unemployment
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» Introduction to Micro Economics
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» Introduction to Macro Economics
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» Macro fundamentals, GDP, Investment, Growth
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» Demand & Supply, Profit Loss, Inflation & Price Index
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» Fiscal Policy, Public Finance and Monetary Policy
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» Money Supply, Banking and Financial Institutions
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» Taxes Types, Methods & Budgeting Process
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» Banking, Security Market & Insurance
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