This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 14 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 14 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the ability of how fast we convert a financial instrument to cash? A) Stability. B) Solvency. C) Liquidity. D) Profitability. Show Answer Correct Answer: C) Liquidity. 2. An account you can deposit money into and then write checks or use debit card to withdraw money is known as a ..... A) Money Market. B) Checking. C) Savings. D) ATM. Show Answer Correct Answer: B) Checking. 3. Maria borrowed $ 3, 000 at a simple interest rate of 4% per year. How much did she have to repay after 4 years? A) $ 480. B) $ 3, 480. C) $ 4, 800. D) $ 7, 800. Show Answer Correct Answer: B) $ 3, 480. 4. Money supply is equal to A) Total stock of money circulation by the central bank. B) Total flow of money circulation by the central bank. C) Total stock of money held by the government. D) Money saved in post office saving bank only. Show Answer Correct Answer: C) Total stock of money held by the government. 5. What is one benefit of banking? A) Complicated transactions. B) Limited access to services. C) Convenience in managing money. D) Increased theft risk. Show Answer Correct Answer: C) Convenience in managing money. 6. Characteristics of money:Scarce- A) Must be valuable. B) It should be a reliable measure to last for a longer period of time. C) The value of currency should not change often. D) I.e. it can't easily be faked or copied. Show Answer Correct Answer: A) Must be valuable. 7. How do banks increase the money supply? A) By printing their own money. B) By getting loans from the Fed. C) By issuing loans with their excess reserves. D) They don't. Show Answer Correct Answer: C) By issuing loans with their excess reserves. 8. Characteristics of money: A) Divisible Portable Acceptable Scarce Durable Stable Hard to counterfeit. B) Divisible Portable Acceptable Scarce Perishable Not Stable Hard to counterfeit. C) Undividable Heavy to Carry Acceptable Scarce Durable Stable Hard to counterfeit. D) Divisible Portable Acceptable in only few countries Unlimited Durable Stable Hard to counterfeit. Show Answer Correct Answer: A) Divisible Portable Acceptable Scarce Durable Stable Hard to counterfeit. 9. Money is accepted as a medium of exchange because of the trust between the payer and the payee is called: A) Full bodied money. B) Credit money. C) Fiat money. D) Fiduciary money. Show Answer Correct Answer: D) Fiduciary money. 10. ..... of wants refers to the simultaneous fulfillment of mutual wants of buyers and sellers A) Medium of exchange. B) Measure of value. C) Measure of Store. D) Double coincidence of want. Show Answer Correct Answer: D) Double coincidence of want. 11. The National Banking-System was created by Congress in ..... to standardize currency and banking practices in the U.S. and issued the first national currency known as the Greenback. A) 1811. B) 1900. C) 1933. D) 1913. Show Answer Correct Answer: D) 1913. 12. How do commercial banks primarily make their profit? A) By charging lower interest rates. B) By charging higher interest rates on loans than they pay on deposits. C) By accepting deposits only. D) By providing free banking services. Show Answer Correct Answer: B) By charging higher interest rates on loans than they pay on deposits. 13. Which coin is worth the least amount? A) Nickel. B) Dime. C) Penny. D) Quarter. Show Answer Correct Answer: C) Penny. 14. Another word for "rich" A) Wealthy. B) Poor. C) Homeless. D) Bank. Show Answer Correct Answer: A) Wealthy. 15. Functions of Money:Money must serve as a ..... Holding money is a much easier way of storing value. A) Medium of exchange. B) Store of value. C) Unit of account. D) Standard of deferred payment. Show Answer Correct Answer: B) Store of value. 16. Credit Unions are not-for-profit organizations A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 17. The difference between representative money and fiat money is that A) Representative money is worth more than fiat money. B) Fiat money is counted in coins; representative money is counted in paper dollars. C) Fiat money is more durable than representative money. D) Representative money is backed by silver or gold, ; fiat money is not. Show Answer Correct Answer: D) Representative money is backed by silver or gold, ; fiat money is not. 18. Which type of card represents money that the holder has on deposit with the issuer? A) ATM card. B) Credit card. C) Debit card. D) Stored-value card. Show Answer Correct Answer: D) Stored-value card. 19. Most banks are established A) By local governments. B) To be credit unions. C) As corporations. D) To fulfill reserve requirements. Show Answer Correct Answer: C) As corporations. 20. Which of the following is a feature of a money market deposit account? A) No minimum balance requirements. B) Unlimited transactions every month. C) Tiered interest rates. D) The money must remain in the account for a specific period of time. Show Answer Correct Answer: C) Tiered interest rates. 21. Fixed deposit is also termed as A) Demand deposit. B) Checkable deposit. C) Time deposit. D) Flexi deposit. Show Answer Correct Answer: C) Time deposit. 22. Credit control is the function of ..... A) Commercial bank. B) Nationalised bank only. C) Both (a) and (b). D) Reserve bank of India. Show Answer Correct Answer: D) Reserve bank of India. 23. Money can be divided into commodity money and ..... money A) Representative. B) Token. C) Paper. D) Cash. Show Answer Correct Answer: B) Token. 24. An investment bank helps ..... issue securities A) A Corporation. B) Government. C) Foreign governments. D) None of the above. Show Answer Correct Answer: A) A Corporation. 25. Which function of money allows it to be used for future payments? A) Medium of exchange. B) Store of value. C) Unit of account. D) Standard of deferred payments. Show Answer Correct Answer: D) Standard of deferred payments. ← 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