This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 13 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 13 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. System in which currency could be exchanged for a certain amount of gold. A) Federal Reserve Notes. B) Legal tender. C) Fiat Money. D) Gold Standard. Show Answer Correct Answer: D) Gold Standard. 2. The market demand curve for money is generate from ..... A) The amount demanded by household to consume on goods and services. B) The vertical sum of money for transaction, precautionary and speculative motives. C) The vertical sum of money that are prepared for savings. D) The amount that provided by central bank to be used for a country. Show Answer Correct Answer: B) The vertical sum of money for transaction, precautionary and speculative motives. 3. During excess demand the A) Reverse repo rate should be reduced. B) Government bonds should be bought by the central bank. C) CRR should be increased. D) Repo rate should be reduced. Show Answer Correct Answer: C) CRR should be increased. 4. What do we get after buying something at a store? A) A letter. B) A receipt. C) A toy. D) A book. Show Answer Correct Answer: B) A receipt. 5. What does the FDIC do? A) Pays you interest in your checking account. B) Protects your money should the bank be robbed. C) Loan you money based on your credit score. D) Takes your money and doesn't give it back. Show Answer Correct Answer: B) Protects your money should the bank be robbed. 6. A portfolio is the collection of all of one's financial assets? A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 7. Assertion (A):The central bank issues currency notes in an economy. Reason (R):The central bank ensures adequate cash flow in the economy by directly printing and distributing money to the public. A) Both A and R are true, and R is the correct explanation of A. B) Both A and R are true, but R is not the correct explanation of A. C) A is true, but R is false. D) A is false, but R is true. Show Answer Correct Answer: C) A is true, but R is false. 8. Pedir prestado/a A) To exchange. B) Cash. C) To borrow. D) Bank. Show Answer Correct Answer: C) To borrow. 9. The fact that money must withstand the wear and tear that comes from being used over and over again is a measure of its A) Portability. B) Currency. C) Durability. D) Age. Show Answer Correct Answer: C) Durability. 10. Easily transferred from one person to another, to make the exchange of money for goods/services easier A) Durability. B) Divisibility. C) Portability. D) Scarcity. Show Answer Correct Answer: C) Portability. 11. The main advantages of a monetary system of exchange compared to a barter system is the increased ..... A) Efficiency in arranging transactions. B) Ability to record transactions. C) Time necessary to find trading partners. D) Time devoted to shopping. Show Answer Correct Answer: A) Efficiency in arranging transactions. 12. Direct exchange of goods against goods is called: A) CHARTER. B) MONEY. C) BARTER. D) NONE OF THESE. Show Answer Correct Answer: C) BARTER. 13. Broad definition of money includes currency, demand deposits, saving deposits and time deposits A) Can't say. B) False. C) True. D) None of the above. Show Answer Correct Answer: C) True. 14. What is the significance of the bank rate? A) The bank rate is solely determined by consumer demand. B) The bank rate is significant as it affects interest rates, inflation, and economic activity. C) The bank rate is irrelevant to inflation. D) The bank rate only affects government spending. Show Answer Correct Answer: B) The bank rate is significant as it affects interest rates, inflation, and economic activity. 15. Accountant A) Konto. B) Buchhalter. C) Kontoauszug. D) Buchhaltung. Show Answer Correct Answer: B) Buchhalter. 16. How do banks earn money? A) By charging interest or fees for their services. B) By borrowing money from customers. C) By storing money for customers. D) By loaning money to other customers. Show Answer Correct Answer: A) By charging interest or fees for their services. 17. Young Metro begins trusting banks and he deposits $ 10, 000 in his. The reserve requirement is 20%. How much can his bank now lend out? A) $ 10, 000. B) $ 2, 000. C) $ 8, 000. D) $ 0. Show Answer Correct Answer: C) $ 8, 000. 18. Suppose that Captain Crunch bank has a customer deposit $ 5, 000 and the bank's excess reserves go up by $ 4, 000. The reserve ratio is A) 10%. B) $ 1000. C) 20%. D) 40%. Show Answer Correct Answer: C) 20%. 19. Money has ..... main functions. A) 2. B) 3. C) 4. D) 5. Show Answer Correct Answer: C) 4. 20. What does it mean for the RBI to be the lender of last resort? A) The RBI's role is to regulate interest rates only. B) The RBI acts as a regular bank for individuals. C) The RBI only provides funds to profitable banks. D) The RBI being the lender of last resort means it provides emergency funds to banks in financial trouble to maintain stability in the financial system. Show Answer Correct Answer: D) The RBI being the lender of last resort means it provides emergency funds to banks in financial trouble to maintain stability in the financial system. 21. When you buy a house you can claim tax ..... on the mortgage. A) Aid. B) Assistance. C) Benefit. D) Relief. Show Answer Correct Answer: D) Relief. 22. Which function of money allows stores to have a standard price system for the goods and services they sell? A) Store of Value. B) Medium of Exchange. C) Unit of Account. D) Dolla Dolla Bills. Show Answer Correct Answer: C) Unit of Account. 23. What are the three functions of money? A) Interest rate, assets, income. B) Medium of exchange, store of value, unit of account. C) Barter, savings, investment. D) Inflation, stocks, borrowing. Show Answer Correct Answer: B) Medium of exchange, store of value, unit of account. 24. M1 money supply in Malaysia consists of ..... A) Coins and bank notes. B) Currency in circulation and current deposits. C) Coins, paper money and saving deposits. D) Currency in circulation, savings deposit and time deposits. Show Answer Correct Answer: C) Coins, paper money and saving deposits. 25. Which of the following determines the amount a bank can lend to its customers? A) Non-performing loans. B) Required reserve. C) Excess reserve. D) Non is correct. Show Answer Correct Answer: C) Excess reserve. ← PreviousNext →Related QuizzesClass 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 1Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 2Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 3Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 4Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 5Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 6Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 7Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 8Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 9Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books