This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 26 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 26 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. In a recession, the Fed would likely A) Increase the supply of money in the economy. B) Decrease the supply of the money in the economy. C) All the above. D) None of the above. Show Answer Correct Answer: A) Increase the supply of money in the economy. 2. Money paid to a person or business for goods or services A) Income. B) Savings. C) All the above. D) None of the above. Show Answer Correct Answer: A) Income. 3. If you sell something and choose not to spend the money earned right away, the money is acting as a A) Unit of Account. B) Store of Value. C) Medium of Exchange. D) Demand Deposit. Show Answer Correct Answer: B) Store of Value. 4. What are the implications of changes in the bank rate? A) Changes in the bank rate solely influence government spending. B) Changes in the bank rate affect interest rates, consumer spending, investment, and overall economic growth. C) Changes in the bank rate have no impact on inflation. D) Changes in the bank rate only affect foreign exchange rates. Show Answer Correct Answer: B) Changes in the bank rate affect interest rates, consumer spending, investment, and overall economic growth. 5. What possess general acceptability? A) Bank draft. B) Bill of exchange. C) Bank draft. D) Cheque. Show Answer Correct Answer: A) Bank draft. 6. Any initial deposit made by the people from their own resource is called A) Secondary deposit. B) Time deposit. C) Primary deposit. D) Term deposit. Show Answer Correct Answer: C) Primary deposit. 7. Local banks in the 1800s that printed too much money were called A) Wildcat banks. B) Central banks. C) Treasuries. D) National banks. Show Answer Correct Answer: A) Wildcat banks. 8. Which types of goods has to be financed by the government? A) Merit. B) Consumer. C) Capital. D) Public. Show Answer Correct Answer: D) Public. 9. The function of money that allows the measurement of the relative value of goods and services is called: A) Medium of exchange. B) Store of value. C) Unit of account. D) Measure of wealth. Show Answer Correct Answer: C) Unit of account. 10. Which of the statements gives an accurate picture of the effect of the increase in the repo rate? A) The money supply in the country will decrease. B) The money supply in the country will increase. C) The money supply in the country will increase initially and then decrease. D) There is no effect on the money supply in the country. Show Answer Correct Answer: A) The money supply in the country will decrease. 11. Which of the following is not true for fiscal deficit? A fiscal deficit: A) Represents the borrowings of the government. B) Is the difference between total expenditure and total receipts of the government. C) Is the difference between total expenditure and total receipts other than borrowings. D) Increase future liability of the government. Show Answer Correct Answer: B) Is the difference between total expenditure and total receipts of the government. 12. Who insures deposits at credit unions? A) Federal Reserve. B) CIA. C) NCUA. D) FDIC. Show Answer Correct Answer: C) NCUA. 13. If an expense can be cut from your budget to save money, it is considered a ..... A) Income. B) Want. C) Need. D) Savings. Show Answer Correct Answer: B) Want. 14. To be successful medium of exchange, money must be all of the following EXCEPT A) Easily available. B) Portable. C) Durable. D) Easily divisible. Show Answer Correct Answer: A) Easily available. 15. Anything that is used to determine value during the exchange of goods and services. A) Store of Value. B) Unit of Account. C) Medium of Exchange. D) Barter System. Show Answer Correct Answer: C) Medium of Exchange. 16. Exposure to sunlight helps a person improve his health because A) The infrared light kills bacteria in the body. B) Resistance power increases. C) The pigment cells in the skin get stimulated and produce a healthy tan. D) The ultraviolet rays convert skin oil into Vitamin D. Show Answer Correct Answer: D) The ultraviolet rays convert skin oil into Vitamin D. 17. ..... are a paper currency issued by the FED A) Specie. B) Federal Reserve Notes. C) Disney bucks. D) Shilling. Show Answer Correct Answer: B) Federal Reserve Notes. 18. Which of the following is not concerned with banking organisation A) Bank rate. B) Fiscal deficit. C) Credit creation. D) Cash reserve ratio. Show Answer Correct Answer: B) Fiscal deficit. 19. Recovery of loan is: A) Revenue receipt. B) Capital receipt. C) Revenue expenditure. D) Capital expenditure. Show Answer Correct Answer: B) Capital receipt. 20. How do central banks influence the economy? A) By printing more money to increase inflation. B) By controlling the stock market directly. C) By imposing strict regulations on all businesses. D) Central banks influence the economy by adjusting interest rates, conducting open market operations, and regulating financial institutions. Show Answer Correct Answer: D) Central banks influence the economy by adjusting interest rates, conducting open market operations, and regulating financial institutions. 21. Money or other substance generally accepted as payment for goods and services. A) Measure of value. B) Medium of exchange. C) Scarcity. D) Store of Value. Show Answer Correct Answer: B) Medium of exchange. 22. What can a camel be traded for A) Sheep and a cow. B) Sheep and a moose. C) 3 sheep and a horse. D) 2 sheep and a cow. Show Answer Correct Answer: D) 2 sheep and a cow. 23. Banks generate their largest portion of income from: A) Loans. B) Short-term investment. C) Demand deposits. D) Long-term investments. E) Certificates of deposit. Show Answer Correct Answer: A) Loans. 24. What is the cash reserve ratio (CRR)? A) Percentage of a bank's deposits held in government bonds. B) Portion of deposits banks must keep as cash with the central bank. C) Amount banks lend to each other in the market. D) Interest rate set by commercial banks. Show Answer Correct Answer: B) Portion of deposits banks must keep as cash with the central bank. 25. If indeed the deposits made by banks are ₹ 10, 000 crore and legitimate reserve requirements are 40 percent, then the amount of initial deposits will be A) ₹ 4000 crore. B) ₹ 14000 crore. C) ₹ 3000 crore. D) ₹ 2000 crore. Show Answer Correct Answer: A) ₹ 4000 crore. ← 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