This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 33 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 33 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is the component of M1 measure of money supply A) Term deposit. B) Demand deposit. C) Both a and b. D) None of these. Show Answer Correct Answer: B) Demand deposit. 2. ..... is the ratio of deposits which bank keep with the central bank A) CRR. B) SLR. C) Bank rate. D) Reverse repo rate. Show Answer Correct Answer: A) CRR. 3. What of the following is not a property of money? A) Carries intrinsic value. B) Portability. C) Recognizable value. D) Durability. Show Answer Correct Answer: A) Carries intrinsic value. 4. About how much should you save in an emergency fund? A) 1 month of expenses. B) 3 months of expenses. C) 6 months of expenses. D) 1 year of expenses. Show Answer Correct Answer: C) 6 months of expenses. 5. Objects that have value in themselves and that are also used as money A) Commodity money. B) Representative money. C) Fiat money. D) M2. Show Answer Correct Answer: A) Commodity money. 6. Money you get back for returning something you bought is a ..... A) Cashpoint. B) Refund. C) Receipt. D) ATM. Show Answer Correct Answer: B) Refund. 7. T/F: "Divisibility" means money can be divided into smaller units without losing value. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 8. What might the Fed do in order to "cool" the economy down? A) Raise interest rates. B) Lower interest rates. C) Lower reserve requirements. D) Raise taxes. Show Answer Correct Answer: A) Raise interest rates. 9. A card authorizing the holder to buy goods or services A) Principal. B) Interest. C) Credit Card. D) Mortgage. Show Answer Correct Answer: C) Credit Card. 10. What is moral suasion in the context of RBI? A) A regulatory measure imposed by RBI to control banks' actions. B) A formal guideline issued by RBI that mandates specific banking practices. C) A financial penalty levied on banks for non-compliance. D) Moral suasion in the context of RBI refers to the use of persuasion and dialogue to influence banks' behavior without enforcing regulations. Show Answer Correct Answer: D) Moral suasion in the context of RBI refers to the use of persuasion and dialogue to influence banks' behavior without enforcing regulations. 11. Which is NOT a place to keep money safe? A) Wallet. B) Bank. C) Sandbox. D) Purse. Show Answer Correct Answer: C) Sandbox. 12. If I had another $ 25, 000 a year, I would consider myself ..... A) Well deserved. B) Well done. C) Well-made. D) Well off. Show Answer Correct Answer: D) Well off. 13. Which is a good synonym for the word barter in the term barter economy? A) Trade. B) Fiat. C) Monetary. D) Specie. Show Answer Correct Answer: A) Trade. 14. "The Fed" refers to the ..... A) Federal Bureau of Investigation. B) Federal Government. C) Federal Reserve System. D) Federal Income Tax. Show Answer Correct Answer: C) Federal Reserve System. 15. Which out of the following is a non-developmental expenditure? A) Scientific research. B) Social Welfare. C) Administration. D) None of them. Show Answer Correct Answer: C) Administration. 16. If the United States is experiencing inflation, the Fed will likely A) Increase the supply of money in the economy. B) Decrease the supply of money in the economy. C) All the above. D) None of the above. Show Answer Correct Answer: B) Decrease the supply of money in the economy. 17. ..... is a currency that must be accepted for payment by decree of government A) Barter. B) Fiat. C) Legal tender. D) Specie. Show Answer Correct Answer: C) Legal tender. 18. The Fed ..... banks to ensure the soundness of the banking system. A) Regulates. B) Closes. C) Opens. D) Runs. Show Answer Correct Answer: A) Regulates. 19. One of the function of Central Bank among the following is A) Custodian of banks. B) Custodian of deliveries. C) Custodian of foreign exchange. D) Custodian of securities. Show Answer Correct Answer: C) Custodian of foreign exchange. 20. Money must be easily divided into smaller denominations (ex. making change). A) Durability. B) Divisibility. C) Acceptability. D) Uniformity. Show Answer Correct Answer: B) Divisibility. 21. A firm installs a new equipment in order to reduce it's pollution emissions. What is the effect of this on private and external costs? A) Private costs:fallExternal costs:fall. B) Private costs:fallExternal costs:rise. C) Private costs:riseExternal costs:fall. D) Private costs:riseExternal costs:rise. Show Answer Correct Answer: C) Private costs:riseExternal costs:fall. 22. Imagine Titi walks into a local bank to inquire about its services. She is curious about what the bank primarily does as a financial institution. A) To provide entertainment services to the public. B) To collect funds from the public and distribute them as credit. C) To manage government administrative tasks. D) To organize cultural events for the community. Show Answer Correct Answer: B) To collect funds from the public and distribute them as credit. 23. The ability to be used as, or directly converted to, cash A) Liquidity. B) Interest. C) M2. D) Medium of exchange. Show Answer Correct Answer: A) Liquidity. 24. Supply for money:There are several definitions of the supply of money. A somewhat broader measure of the supply of money is ..... , which includes all of M1 plus savings and time deposits held at banks. A) M1. B) M2. C) M3. D) None of the above. Show Answer Correct Answer: B) M2. 25. What is likely to happen to money in the future? A) Physical currency will disappear and we will use digital cash. B) Physical currency will stay the same and the internet will disappear. C) Physical currency will disappear and we will use cowrie shells. D) None of the above. Show Answer Correct Answer: A) Physical currency will disappear and we will use digital cash. ← 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