Macro

Money & Banking

Medium

Match List-I with List-II

List-I List-II
(A) Bank Rate (I) Securities are pledged in order to repurchase.
(B) Open Market Operations (II) Minimum rate at which funds are provided for long term.
(C) Repo Rate (III) Buying and selling of bonds issued by the government in open market.
(D) Reverse Repo Rate (IV) Central bank borrows funds from commercial banks.

Choose the correct answer from the options given below:

List-I	List-II
(A) Bank Rate	(I) Securities are pledged in order to repurchase.
(B) Open Market Operations	(II) Minimum rate at which funds are provided for long term.
(C) Repo Rate	(III) Buying and selling of bonds issued by the government in open market.
(D) Reverse Repo Rate	(IV) Central bank borrows funds from commercial banks.

(A) - (II), (B) - (IV), (C) - (I), (D) - (III)

(A) - (III), (B) - (II), (C) - (I), (D) - (IV)

(A) - (II), (B) - (I), (C) - (III), (D) - (IV)

(A) - (II), (B) - (III), (C) - (I), (D) - (IV)

✅ Correct Option: 4

(A) - (II), (B) - (III), (C) - (I), (D) - (IV) -> Let me explain each match:

• Bank Rate (A) - (II): Bank Rate is the minimum rate at which the central bank provides long-term funds to commercial banks. It's a lending rate for longer duration loans.

• Open Market Operations (B) - (III): OMO involves buying and selling of government bonds and securities in the open market by the central bank to regulate money supply and liquidity in the economy.

• Repo Rate (C) - (I): Repo (Repurchase Agreement) Rate is the rate at which commercial banks borrow from the central bank by pledging securities with an agreement to repurchase them later.

• Reverse Repo Rate (D) - (IV): This is the rate at which the central bank borrows funds from commercial banks. It's essentially the reverse of repo rate, where banks park their excess funds with the central bank.

These are key monetary policy instruments used by central banks (like RBI in India) to control money supply, inflation, and maintain economic stability. -> correct

2023: 29 May Shift 2

The Reserve Bank of India (RBI) recently imposed a monetary penalty on three banks -- Rs 1.50 lakhs on Dr. Ambedkar Nagarik Sahakari Bank Maryadit, Rs 25,000 on Nagarik Sahakari Bank Maryadit, and Rs 1 lakh on Ravi Commercial bank for violating the provisions of its regulations. The banking regulator has imposed a monetary penalty for contravention of non-compliance with the directions issued to Ravi Commercial bank on exposure norms and statutory and other restrictions & KYC.

Which function of central Bank is refered to in the above paragraph.

2026: 15 May Shift 1

In commercial banks, saving and current account deposits are held by the public. There are other deposits like fixed deposits, having a fixed period to maturity and are referred to as _______________.

2025: 29 May Shift 2

Consider the following steps taken by the Reserve Bank of India with respect to money supply and arrange them in the appropriate sequence.

(A) Increase in lending rates by commercial banks.

(B) Contraction in credit.

(D) Increase in cost of borrowings by commercial banks.

Choose the correct answer from the options given below:

2026: 13 May Shift 1

Match List-I with List-II

List-I	List-II
(A) M1	(I) M1 + Net time deposits of commercial banks
(B) M2	(II) M3 +Total deposits with Post Office savings organisations(excluding NSC)
(C) M3	(III) CU + DD
(D) M4	(IV) M1 + Savings deposits with Post Office savings banks

Choose the correct answer from the options given below:

2026: 21 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Lender of last resort	(I) 1/Cash reserve ratio
(B) Money multiplier	(II) Buying and selling government securities
(C) Open market operations	(III) RBI
(D) $M^d_t$ = kPY	(IV) Transaction demand for money is positively related to the real income of an economy.

Choose the correct answer from the options given below:

2022: 19 July Shift 2

Suppose in an economy, the legal Required ratio fixed by the Central Bank is 20% and the value of initial deposits is $\overline{\mathbf{\tau}}$ 1000 crores. What is the value of loans extended by the Commercial Banks ?

Solution

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