CUET Economics: MacroMoney & Banking. Free, no login required.

In a Commercial Bank, if the initial deposit of Rs 1000 create deposits of Rs 5000, then the cash reserve ratio will be_________.

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One of the important function of the Central bank is to provide funds to commercial banks at the time of emergency. Identify the instrument through which RBI can perform this function.

Arrange the following measures of money supply in ascending order of their liquidity.

(A) Currency + Demand Deposits.

(B) M1 + Net time deposits of commercial banks.

(C) M1 + Savings deposits with Post Office savings banks.

(D) M3 + Total deposits with Post Office savings organisations (excluding National Savings Certificates).

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Exchange of commodities without the mediation of money is called as?

Which of the following is most commonly used measures of money supply, also known as aggregate monetary resources?

When the central bank buys the security, this agreement of purchase also has specifications about the date and price of resale of this security. The rate at which these agreements are carried out is known as ?

Which of the following are the quantitative tools opted by Central bank to control money supply.

(A) Cash reserve Ratio.

(B) Moral Suasion.

(C) Bank Rate.

(D) Margin requirement.

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The money supply measures, M1 and M2 are also known by which of the following term:

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Arrange the following measures of money supply in decreasing order of their liquidity.

(A) M4

(B) M2

(C) M1

(D) M3

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Which among the following limits the money multiplier process?

The situation where people are willing to hold any amount of money at a very low interest rate is called?

Which of the following action by RBI leads to an increase in the supply of money in the economy:

Arrange the following statements related to open market operations, a tool used by the Reserve Bank of India to control money supply in the economy, in the correct order of occurrence:

A. The total amount of reserves in the economy increases.

B. RBI buys government bonds.

C. As a result, money supply will increase.

D. RBI pays for the bonds by providing a cheque.

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From the following, choose the correct options as the functions of the Reserve Bank of India.

A. Regulates the reserve requirements of commercial banks.

B. Sterilizes the money supply in the economy against external shocks.

C. Maintains the deposits of the public.

D. Regulates money supply by controlling the stock of high-powered money.

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Instead of outright sale of securities the central bank may sell the securities through an agreement which has a specification about the date and price at which it will be repurchased. The rate at which such agreements take place is known as-----------------.

"In India every currency note bears on its face a promise from the Governor of the Reserve Bank of India(RBI) that if someone produces the note to RBI, or any other commercial bank, the RBI will be responsible for giving the person purchasing power equal to the value printed on the note. The same is also true of coins."

These currency notes and coins are also known by which of the following type of money.

Which is the apex regulatory body of the Indian banking system and in which year it came into existence?

What are the short and long term tools of lending to commercial banks by the RBI?

If the total amount of deposits with a bank is 200 crores and the Reserve Ratio (RR) is 5% then what is the maximum loanable amount which the bank can lend out in the form of a loan?

What are the broad components of money supply measure M3?

A. Currency in circulation

B. Net fixed deposits with the banking system

C. Post office savings deposit

D. Demand Deposits

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The Central Bank is a very important institution in the modern economy. What are the main characteristics of the Reserve Bank of India?

(A) India got its central bank in 1935.

(B) It is the custodian of the foreign exchange reserves of the economy.

(C) It controls the money supply of the country through various methods, like bank rate, open market operations etc.

(D) It also acts as a bank for the banking system.

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The interest rate paid by the commercial banks to depositors is lower than the rate charged from the borrowers. This difference between these two types of interest rates, called?

1. Bank Rate.
2. Spread.
3. Reserve.
4. Deposits.

To tackle the problem of corruption, black money, terrorism and the circulation of fake currency in the economy, demonetization was an initiative taken by the Government of India in the period?

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The Reserve Bank of India publishes four measures of money supply. Which one of the measures is the least liquid in them?

If the central bank wants to reduce the money supply in the economy, what it may do from the following?

(A) Increase bank rate.

(B) Reduce cash reserve ratio.

(C) Increase in Repo Rate.

(D) Buy securities in the open market.

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Kavish went to the supermarket with ₹5000 in his wallet to buy groceries for his family. He purchased vegetables, fruits and other household items, paying the respective prices at the counter. Which functions of money were being demonstrated in this real life scenario?

(A) Unit of Labour.

(B) Store of Value.

(C) Medium of Exchange.

(D) Measure of Creditworthiness.

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Mr. Kishore, an economics teacher, was explaining the concept of 'minimum percentage of total deposits to be kept by any commercial bank with the Central bank of the country, as per norms and statute prevailing in the country'.

From the following, choose the correct alternative which specifies towards the concept explained by him: