This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 25 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 25 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is money? A) Something that people will accept as payment for goods and services. B) A yardstick of economic value in exchanges. C) Percentage of the total amount of money loaned or borrowed. D) Things of economic value that a person or company owns. Show Answer Correct Answer: A) Something that people will accept as payment for goods and services. 2. An account that allows quick access to funds for transactions A) Checking account. B) Overdraft account. C) Investment account. D) Loan. Show Answer Correct Answer: A) Checking account. 3. Electronic transfer of money in terms of credit/debit entries of the account holders in the banks is called A) E-marketing. B) E-business. C) E-money. D) E-banking. Show Answer Correct Answer: C) E-money. 4. Which of the following is NOT a characteristic of money as described in the learning material? A) Portable. B) Divisible. C) Perishable. D) Stable. Show Answer Correct Answer: C) Perishable. 5. In the process of creation of credit banks create A) Time deposits. B) Demand deposits. C) CRR. D) SLR. Show Answer Correct Answer: B) Demand deposits. 6. Which of these is NOT a way to pay for things? A) Credit card. B) Shells. C) Debit card. D) Paper money. Show Answer Correct Answer: B) Shells. 7. How many Federal Reserve Districts are there? A) 6. B) 9. C) 12. D) 20. Show Answer Correct Answer: C) 12. 8. Which of these conditions is needed for a financial institution to become a bank? A) Accepting deposits. B) Advancing loans. C) Both above mentioned. D) None of these. Show Answer Correct Answer: C) Both above mentioned. 9. With electronic banking, A) Direct deposits of paychecks are not covered by FDIC insurance. B) Customers can have recurring bills paid through the bank's bill paying service. C) Information security laws permit customers to see their statements but not to print them. D) Debit cards are unnecessary. Show Answer Correct Answer: B) Customers can have recurring bills paid through the bank's bill paying service. 10. Which of the following are how the Fed Measures Money A) Currency. B) M1 and M2. C) DDA's. D) Dollars. Show Answer Correct Answer: B) M1 and M2. 11. Which type of money has intrinsic value? A) Digital currency. B) Fiat money. C) Representative money. D) Commodity money. Show Answer Correct Answer: D) Commodity money. 12. What is the main aim of a commercial bank A) To act as banker to the government. B) To make a profit. C) To issue bank notes. D) To manage the national debt. Show Answer Correct Answer: B) To make a profit. 13. How many pennies make 5 cents? A) 2 pennies. B) 3 pennies. C) 5 pennies. D) 4 pennies. Show Answer Correct Answer: A) 2 pennies. 14. Which of the following will increase money supply A) Rise in repo rate. B) Sale of securities in open market. C) Decrease in cash reserve ratio. D) All of these. Show Answer Correct Answer: C) Decrease in cash reserve ratio. 15. Which of the following is a step that the central bank will take to encourage greater investment in the economy? A) It will look to increase the cash reserve ratio. B) It will look to reduce the cash reserve ratio. C) It will look to increase the bank rate. D) It will look to sell the government securities in the open market. Show Answer Correct Answer: B) It will look to reduce the cash reserve ratio. 16. Aria, Maya, and Rohan are discussing the importance of creating a personal budget. According to them, why is it important? A) So they can overspend and accumulate debt. B) So they can have no control over their finances. C) To track their income and expenses, prioritize spending, and save money. D) To ignore their financial goals and aspirations. Show Answer Correct Answer: C) To track their income and expenses, prioritize spending, and save money. 17. Functions of Money:Money serves as a ..... , which means that it is the ruler by which other values are measured. A) Medium of exchange. B) Store of value. C) Unit of account. D) Standard of deferred payment. Show Answer Correct Answer: C) Unit of account. 18. What characteristic of money ensures it can be easily divided into smaller units for transactions? A) Durability. B) Acceptability. C) Portability. D) Divisibility. Show Answer Correct Answer: D) Divisibility. 19. What is the basic function of a commercial bank? A) Accepting deposits and granting loans. B) Issuing currency notes. C) Providing insurance services. D) Selling securities. Show Answer Correct Answer: A) Accepting deposits and granting loans. 20. Which of the following does not come under quantitative methods of monetary policy? A) Open market operations. B) Cash reserve ratio. C) Moral suasion. D) Repo rate. Show Answer Correct Answer: C) Moral suasion. 21. An institution that receives, lends, borrow, exchange, issues and safeguards money. A) Money Supply. B) Gold Standard. C) National Bank. D) Bank. Show Answer Correct Answer: D) Bank. 22. To afford A) Sich leisten. B) Ausgeben. C) Einnehmen. D) Einzahlen. Show Answer Correct Answer: A) Sich leisten. 23. How do banks ensure the safety of deposits? A) Banks charge fees to ensure deposit safety. B) Deposits are kept in physical vaults only. C) Banks invest deposits in high-risk stocks. D) Banks ensure the safety of deposits by using deposit insurance, regulatory compliance, risk management, and secure technologies. Show Answer Correct Answer: D) Banks ensure the safety of deposits by using deposit insurance, regulatory compliance, risk management, and secure technologies. 24. ..... is a U.S. government institution that provides insurance on depositor's accounts A) Congress. B) Department of the Interior. C) FDIC. D) Department of Homeland Security. Show Answer Correct Answer: C) FDIC. 25. Bank notes, coins, credit card, checks are examples of ..... A) Commodity money. B) Non physical money. C) Token money. D) Currency. Show Answer Correct Answer: C) Token money. ← 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