money supply, banking & financial institutions section 7 Practice Questions Answers Test with Solutions & More Shortcuts

Question : 31

Which of the following statements are true regarding the Monetary Policy Committee (MPC)?

1. It has the authority to decide repo rate, CRR, SLR
2. Its decision is binding on RBI

a) (ii) only

b) Both (i) & (ii)

c) (i) only

d) Neither (i) nor (ii)

Question : 32

Consider the following statements:

1. Debt overhang refers to a debt burden so large that an entity cannot take on additional debt to finance future projects.
2. Debt trap is a situation in which it becomes difficult or impossible to repay the debt

a) (ii) only

b) Both (i) & (ii)

c) (i) only

d) Neither (i) nor (ii)

Question : 33

According to the Chakravarthy Committee, one of the principal causes affecting price stability in India is:

a) existence of black money

b) India’s precarious balance of payment position

c) violent fluctuation in agricultural production

d) fiscal deficit

Question : 34 [SSC CGL 2016]

Open Market Operations refer to __________ .

a) Purchase and sale of Government securities by RBI

b) Deposit mobilisation

c) Borrowings by Scheduled banks from RBI

d) Lending by Commercial banks to industry

Question : 35

Which of the following are the reasons that make a moderate level of inflation good for the economy?

1. It increases consumption levels
2. It keeps businesses profitable
3. It induces people to save more

a) (i) & (ii) only

b) (iii) only

c) (ii) only

d) All of the above