This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 3 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What happens to interest rates when the central bank increases the money supply? A) Interest rates rise. B) Interest rates remain unchanged. C) Interest rates fall. D) Interest rates fluctuate. Show Answer Correct Answer: C) Interest rates fall. 2. What is money supply A) Circulation of money in economy. B) Money holded by government. C) Money held by banks. D) All the above. Show Answer Correct Answer: A) Circulation of money in economy. 3. The Federal Reserve is called "The Bankers Bank" because it supervises banks. A) False. B) True. C) All the above. D) None of the above. Show Answer Correct Answer: B) True. 4. People can take their money with them easily. A) Portability. B) Uniformity. C) Durability. D) Divisibility. Show Answer Correct Answer: A) Portability. 5. What is the ratio of deposits which commercial banks are required to keep with themselves called? A) CRR. B) SLR. C) Both. D) None of the above. Show Answer Correct Answer: B) SLR. 6. Which of the following is an example of a banking service? A) Checking account. B) Movie theater. C) Grocery store. D) Credit card. Show Answer Correct Answer: A) Checking account. 7. Money must be able to withstand the wear and tear of many people using it. A) Divisibility. B) Durability. C) Limited Supply. D) Acceptability. Show Answer Correct Answer: B) Durability. 8. If initial deposit is 10, 000, CRR is 8% and SLR is 12%, what will be the amount of total deposits created by commercial banks? A) 30, 000. B) 40, 000. C) 50, 000. D) 1, 00, 000. Show Answer Correct Answer: C) 50, 000. 9. Which of the following was never used as currency? A) Beads. B) Bananas. C) Salt. D) Gold. Show Answer Correct Answer: B) Bananas. 10. Given below are two statements, one (A) and the other labelled as (B):Statement (A):the first and foremost role of money is that it acts as a medium of exchange. Statement (B):Money also acts as a convenient unit of account.In the context of the above two statements, which of the following is correct? A) Both (A) and (B) are correct. B) Both (A) and (B) are incorrect. C) Only (A) is correct. D) Only (B) is correct. Show Answer Correct Answer: A) Both (A) and (B) are correct. 11. Are career prospects a wage or non wage factor? A) Wage. B) Non wage. C) All the above. D) None of the above. Show Answer Correct Answer: B) Non wage. 12. Credit creation in commercial banks in determined by: A) Cash Reserve Ratio. B) Statutory Liquidity Ratio. C) Initial Deposits. D) All of the Deposits. Show Answer Correct Answer: D) All of the Deposits. 13. Which of the following is the BEST example of a barter system? A) Instead of paying the full amount for a car, you pay 10% in cash and pay for the rest in monthly installments. B) Instead of paying for a purchase in Mexico in pesos, you use US dollars. C) Instead of paying rent for your apartment, you clean the house for the owner. D) Instead of paying cash for a computer, you use a credit card. Show Answer Correct Answer: C) Instead of paying rent for your apartment, you clean the house for the owner. 14. The value of token money is ..... its cost of production A) Higher than. B) Lower than. C) Equal to. D) None of the above. Show Answer Correct Answer: A) Higher than. 15. An ATM can allow you to ..... A) Access and transfer money. B) Order goods online. C) Speak with others around the world. D) Pay money directly to your boss. Show Answer Correct Answer: A) Access and transfer money. 16. Debts A) Schulden. B) Kontoauszug. C) Kontostand. D) Schuldner. Show Answer Correct Answer: A) Schulden. 17. What system was used for transactions before the invention of money? A) Barter System. B) Credit System. C) Monetary System. D) Digital Currency. Show Answer Correct Answer: A) Barter System. 18. Which of the following is NOT a key function of a central bank? A) Lender of last resort. B) Issuer of legal tender. C) Providing mortgages to households. D) Banker to the government. Show Answer Correct Answer: C) Providing mortgages to households. 19. In India, coins are issued by A) SBI. B) RBI. C) Ministry of Finance. D) Ministry of Urban development. Show Answer Correct Answer: C) Ministry of Finance. 20. Your forgot to pay $ 100 on your credit card bill this month, your next month's bill is going to be $ 112. How much interest did they charge for missing your payment? A) 112%. B) 2%. C) 12%. D) 22%. Show Answer Correct Answer: C) 12%. 21. If you said that a pair of jeans and a fleece vest were both worth $ 35, you would be speaking of money as a A) Standard of value. B) Medium of exchange. C) Store of value. D) Method of barter. Show Answer Correct Answer: A) Standard of value. 22. The Monetary policy generally targets to ensure ..... A) Price stability in the economy. B) Employment generation in the country. C) Stable foreign relations. D) Greater tax collections for the government. Show Answer Correct Answer: A) Price stability in the economy. 23. M1 and M2 makeup all of this in the U.S. economy. A) Fiat money. B) Representative money. C) Currency. D) Money supply. Show Answer Correct Answer: D) Money supply. 24. When incidence and burden of tax falls on different persons that type of tax is called: A) Direct tax. B) Indirect tax. C) Regressive tax. D) None of these. Show Answer Correct Answer: B) Indirect tax. 25. Janet inherited a valuable necklace and needs a safe place to keep it when she isn't wearing it, A) Checking account. B) Savings account. C) Safe deposit box. D) None of the above. Show Answer Correct Answer: C) Safe deposit box. ← 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 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 10Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books