This quiz works best with JavaScript enabled. Home > Cbse > Class 10 > Economics > Money And Credit > Class 10 Economics Chapter 3 Money And Credit – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 10 Economics Chapter 3 Money And Credit Quiz 2 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The deposits in which the savings can be withdrawn at short notice and the bank is liable to pay it on demand, is also called as A) Time deposits. B) Fixed deposits. C) Demand deposits. D) Recurring deposits. Show Answer Correct Answer: C) Demand deposits. 2. Which state accounts for maximum percentage of SHGs (self-help groups) in bank credit? A) Andhra Pradesh. B) Tamil Nadu. C) Kerala. D) Compare. Show Answer Correct Answer: A) Andhra Pradesh. 3. Banks in India these days hold about ..... of their deposits as cash. This is kept as a provision to pay the depositors who might come to withdraw money from the bank on any given day. A) 25%. B) 30%. C) 15%. D) 20%. Show Answer Correct Answer: C) 15%. 4. An asset that the borrower owns (such as land, building, vehicle, livestock, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid. A) Loan. B) Collateral. C) Credit. D) None of the above. Show Answer Correct Answer: B) Collateral. 5. M. Salim wants to withdraw Rs 20, 000 in cash for making payments to Prem after Prem receives the money he deposits it in his own account? What is the result? A) Salim's balance in his bank account increases, and Prem's balance increases. B) Salim's balance in his bank account decreases and Prem's balance increases. C) Salim's balance in his bank account increases and Prem's balance decreases. D) None of the above. Show Answer Correct Answer: B) Salim's balance in his bank account decreases and Prem's balance increases. 6. Name the system in which the double coincidence of wants is an essential feature. A) Barter system. B) Money economy. C) Global economy. D) None of these. Show Answer Correct Answer: A) Barter system. 7. Choose the correct meaning of organised sector: A) It covers those enterprises where the terms of employment are regular. B) It is outside the control of the government. C) It provides low salaries. D) Jobs are not regular. Show Answer Correct Answer: A) It covers those enterprises where the terms of employment are regular. 8. Identify the primary Or main function of money A) Standard of deferred payments. B) Store of value. C) Transfer of value. D) Measure of value. Show Answer Correct Answer: D) Measure of value. 9. The ..... supervises the functioning of formal sources of loans. A) Commercial bank. B) Private bank. C) Reserve Bank of India. D) None of the above. Show Answer Correct Answer: C) Reserve Bank of India. 10. The commodity money which is used in China was A) Gold. B) Sheep. C) Cattle. D) Teeth. Show Answer Correct Answer: D) Teeth. 11. The ..... legalises the use of rupee as a medium of payment that cannot be refused in settling transactions in India. A) Prime Minister. B) Government. C) Court. D) Law. Show Answer Correct Answer: D) Law. 12. The currency is authorised by the ..... of the country A) The Reserve of Bank. B) The Central Bank of India. C) Government. D) The Federal Bank of India. Show Answer Correct Answer: A) The Reserve of Bank. 13. Formal sector loan sources are ..... A) Money lenders, friends, relatives. B) Land owners, employers. C) Banks, Cooperative societies, SHGs. D) Reserve Bank of India, The World Bank. Show Answer Correct Answer: C) Banks, Cooperative societies, SHGs. 14. ..... is called the medium of exchange A) Cheque. B) Bitcoins. C) Money. D) Deposits. Show Answer Correct Answer: C) Money. 15. Grameen Bank started in ..... year A) 1970s. B) 1980s. C) All the above. D) None of the above. Show Answer Correct Answer: A) 1970s. 16. Interest payment will be higher on a home loan on account of A) High tenure of loan. B) Lack of proper documentation. C) High risk of borrower profile. D) All of these. Show Answer Correct Answer: D) All of these. 17. ..... of the loans taken by poor households in the urban areas are from informal sources. A) 50 per cent. B) 65 per cent. C) 85 per cent. D) 70 per cent. Show Answer Correct Answer: C) 85 per cent. 18. Under Barter System the exchange of goods require ..... A) Communication. B) Advertising. C) Double coincidence of wants. D) A good transport system. Show Answer Correct Answer: C) Double coincidence of wants. 19. Why do banks ask for collateral? Choose the most appropriate or complete answer. A) Bank can sell if they need to raise money. B) It is a guarantee that borrower will pay on time. C) In case if the borrower will not pay back then the bank can sell the asset and recover its money. D) It is an RBI regulation that banks must ask for collateral. Show Answer Correct Answer: C) In case if the borrower will not pay back then the bank can sell the asset and recover its money. 20. A typical Self Help Group usually has A) 100-200 members. B) 50-100 members. C) 15-20 members. D) Less than 10 members. Show Answer Correct Answer: C) 15-20 members. 21. Rizwan is a shopkeeper. He wants to take a loan of Rs 5 lakhs to upgrade his shop. Why would you suggest him not to take loan from the local moneylender? A) Because the local money lender is not a good person. B) Because the moneylender will ask for collateral. C) Because the moneylender will charge the high-interest rate. D) None of these. Show Answer Correct Answer: C) Because the moneylender will charge the high-interest rate. 22. The total money in circulation with the public at any point of time is through A) Currency and demand deposits. B) Savings and current deposits. C) Both a) and b). D) None of the above. Show Answer Correct Answer: C) Both a) and b). 23. In monetary management broad money refers to A) M1 and M4. B) M1 and M3. C) M3 and M4. D) M2 and M3. Show Answer Correct Answer: C) M3 and M4. 24. Direct exchange of goods without the use of money is known as A) Debt kick. B) Barter System. C) Monetary System. D) None of the above. Show Answer Correct Answer: B) Barter System. 25. Money is based on A) Double coincidence of wants. B) Single coincidence of wants. C) Both (a) and (b). D) None of these. Show Answer Correct Answer: A) Double coincidence of wants. 26. Which one of the following statements is most appropriate regarding transaction made in money? A) It is the easiest way. B) It is safest way. C) It promotes trade. D) It is the cheapest way. Show Answer Correct Answer: A) It is the easiest way. 27. Why are demand deposits considered as money? A) Payments can be made by cheques instead of cash. B) Banks accept the deposits and also pay an interest rate on the deposits. C) The RBI of Indian issues currency notes on behalf of the Central Government. D) Demand deposits are closely linked to the working of the modern banking system. Show Answer Correct Answer: A) Payments can be made by cheques instead of cash. 28. Which one of the following is not a quantitative credit control measures A) Bank Rate Policy. B) Credit rationing. C) Varying Reserve Requirements. D) Open market operations. Show Answer Correct Answer: B) Credit rationing. 29. WHICH OF THE FOLLOWING IS THE CORRECT MEANING OF COLLATERAL A) AMOUNT INVESTED IN BUSSINESS. B) AMOUNT BORROWED FROM FRIENDS. C) SUM TOTAL BORROWED FROM BANKS. D) ASSET OF BORROWER USED AS AGUARANTEE. Show Answer Correct Answer: D) ASSET OF BORROWER USED AS AGUARANTEE. 30. ..... and ..... are the ancient forms of money A) Currency notes and deposits. B) Grains and cattle. C) Gold and silver coins. D) Cheques and deposits. Show Answer Correct Answer: B) Grains and cattle. 31. Which households take more loans from the formal sector? A) Poor households and rich household. B) Well off households and households with few assets. C) Poor households and well off households. D) Well off households and rich households. Show Answer Correct Answer: D) Well off households and rich households. 32. Loans are also known as credit A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 33. Which is not the main source of credit from the following for rural households in India? A) Traders. B) Relatives and friends. C) Commercial Banks. D) Moneylanders. Show Answer Correct Answer: A) Traders. 34. Megha is taking a loan from the bank. She has to agree to certain terms of credit. Which of the following is not a term of credit that she has to agree? A) Salary slips. B) Location map of the place. C) An interest rate of 10%. D) Documents of her new house have to be submitted to the bank. Show Answer Correct Answer: B) Location map of the place. 35. Compared to the formal lenders, most of the informal lenders charge a much ..... interest on loans. A) Higher. B) Lesser. C) All the above. D) None of the above. Show Answer Correct Answer: A) Higher. 36. Which among the following banks issues currency notes on behalf of the Central Government in India? A) Bank of India. B) State Bank of India. C) Central Bank of India. D) RBI. Show Answer Correct Answer: D) RBI. 37. Formal sector meets only about ..... of the total credit needs of the rural people in 2003. A) One third. B) One fourth. C) Half. D) Whole. Show Answer Correct Answer: C) Half. 38. Identify the formal source of credit: A) Cooperative societies. B) Moneylenders. C) Traders. D) Landlords. Show Answer Correct Answer: A) Cooperative societies. 39. A ..... is a paper instructing the bank to pay a specific amount from the person's account to the person in whose name it has been issued? A) ATM facility. B) Deposit slip. C) Withdrawal slip. D) Cheque. Show Answer Correct Answer: D) Cheque. 40. Loan provided by Co Operative Societies is called A) Formal Loan. B) Informal Loan. C) All the above. D) None of the above. Show Answer Correct Answer: A) Formal Loan. 41. Formal sector loans include loans from 1. Banks 2. Money lenders 3. Cooperatives 4. Traders A) 2 & 3. B) 1 & 3. C) 1 & 4. D) 2 & 4. Show Answer Correct Answer: B) 1 & 3. 42. Money is a measure of A) Currency. B) Value. C) Transfer. D) All of these. Show Answer Correct Answer: A) Currency. 43. Pre requisite of Barter System A) Coincidence of wants. B) Triple coincidence of wants. C) Double coincidence of wants. D) No coincidence of wants. Show Answer Correct Answer: C) Double coincidence of wants. 44. In situations with high risks, credit might create further problems for the borrower, what is it called? A) Absence of collateral. B) Debt trap. C) Debit. D) Demand deposits. Show Answer Correct Answer: B) Debt trap. 45. Swapna is unable to repay the moneylender and she is caught in debt. She has to sell a part of the land to pay off the debt. This situation is an example of A) Debt-insecurity. B) Debt-loss. C) Debt-condition. D) Debt-Stairs. Show Answer Correct Answer: D) Debt-Stairs. 46. What was used as a commodity money in Greece A) Gold. B) Sheep. C) Cattle. D) Teeth. Show Answer Correct Answer: C) Cattle. 47. In which country is the Grameen Bank meeting the credit needs of over 8.5 million poor people? A) Bhutan. B) Burma. C) Brazil. D) Bangladesh. Show Answer Correct Answer: D) Bangladesh. 48. The modern forms of money are ..... and ..... A) Grains and cattle. B) Gold and silver coins. C) Currency and deposits. D) None of the above. Show Answer Correct Answer: C) Currency and deposits. 49. An increase in the rate of SLR will; A) Increase Lending activities by Commercial Banks. B) Decrease lending activities by Commercial Banks. C) Will not impact lending at all. D) None of the above. Show Answer Correct Answer: B) Decrease lending activities by Commercial Banks. 50. Reserve bank of India (RBI) was established on A) 1$^{st}$ April 1935. B) 1$^{st}$ oct 1947. C) 1$^{st}$ April 1945. D) 1$^{st }$oct 1945. Show Answer Correct Answer: A) 1$^{st}$ April 1935. 51. Banks use the major portion of the deposits to A) Extend loans. B) Meet renovation of bank. C) Meet their routine expenses. D) Keep as a reserve so that people may withdraw. Show Answer Correct Answer: A) Extend loans. 52. ..... is an asset that the borrower owns (such as land, building, vehicle, livestock, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid? A) Warranty. B) Guarantee. C) Debt trap. D) Collateral. Show Answer Correct Answer: D) Collateral. 53. Which of the following is not considered as money? A) Demand deposits with the banks. B) Cheque. C) Gold coin. D) Currency. E) Rupee coins. Show Answer Correct Answer: C) Gold coin. 54. Reserve bank of India (RBI) was nationalized on A) 1$^{st}$ January 1947. B) 1$^{st}$ January 1949. C) 12$^{th}$ February 1954. D) 1$^{st}$ April 1935. Show Answer Correct Answer: B) 1$^{st}$ January 1949. 55. Credit (loan) refers to an agreement in which the lender supplies the borrower with ..... in return for the promise of future payment. A) Money. B) Goods. C) Services. D) Any of the above. Show Answer Correct Answer: A) Money. 56. Banks provide a higher rate of interest on which one of the following accounts A) Fixed deposit for long time. B) Fixed deposit for short term. C) Savings account. D) Current account. Show Answer Correct Answer: A) Fixed deposit for long time. 57. Which among the following bank issues currency on behalf of central government of India? A) 4.Central Bank of India. B) 1.RBI. C) 2.SBI. D) 3.Bank of India. Show Answer Correct Answer: B) 1.RBI. 58. The formal sector still meets only about ..... of the total credit needs of the rural people A) 1/FTH. B) Half. C) H/thh. D) None of the above. Show Answer Correct Answer: B) Half. 59. Why do banks keep a small proportion of the deposits as cash with themselves? A) To extend loan to the poor. B) To pay salary to their staff. C) To extend loan facility. D) To pay the depositors who might come to withdraw money. Show Answer Correct Answer: C) To extend loan facility. 60. What was used as a commodity money in Rome A) Sheep. B) Gold. C) Cattle. D) Teeth. Show Answer Correct Answer: A) Sheep. ← PreviousNext →Related QuizzesEconomics QuizzesClass 10 QuizzesClass 10 Economics Chapter 3 Money And Credit Quiz 1Class 10 Economics Chapter 3 Money And Credit Quiz 3Class 10 Economics Chapter 3 Money And Credit Quiz 4Class 10 Economics Chapter 3 Money And Credit Quiz 5 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books