money supply, banking & financial institutions section 6 Practice Questions Answers Test with Solutions & More Shortcuts

Question : 6

Which of the following scenarios can support sustainable economic growth?

1. Deflation
2. Low and moderate inflation
3. Galloping inflation
4. Hyperinflation

a) (i) & (ii) only

b) (ii) & (iii) only

c) (ii) only

d) All of the above

Question : 7 [UPSC (Pre) 2013]

Priority Sector lending by banks in India constitutes the lending to

a) Micro and small enterprises

b) All of the above

c) Weaker sections

d) Agriculture

Question : 8

The _________ bank linkage programme continued to be the main micro-finance model by which the formal banking system reaches micro-entrepreneurs (including farmers).

1. Self-Help Group
2. Indian bank
3. SBI
4. PNB

a) 2 only

b) 1 only

c) 3 only

d) 4 only

Question : 9

In the context of the Indian economy, which of the following is/are the purpose/purposes of ‘Statutory Reserve Requirements’?

1. To enable the Central Bank to control the number of advances the banks can create
2. To make the people’s deposits with banks safe and liquid
3. To prevent the commercial banks from making excessive profits
4. To force the banks to have sufficient vault cash to meet their day-to-day requirements

a) 1 and 2 only

b) 1 only

c) 2 and 3 only

d) 1, 2, 3 and 4

Question : 10 [SSC CGL 2016]

The major objective of monetary policy is to

a) Promote economic growth with price stability

b) weed out corruption in the economy

c) increase government’s tax revenue

d) revamp the Public Distribution System