This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 42 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 42 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the equation of exchange? A) 1/RR. B) 1/MPS. C) MV=PQ=GDP. D) Excess=Actual-Required. Show Answer Correct Answer: C) MV=PQ=GDP. 2. What is meant by 'financial literacy'? A) Understanding how to invest in stocks only. B) The ability to calculate taxes accurately. C) Financial literacy is the ability to make informed and effective decisions regarding financial resources. D) Knowledge of accounting principles exclusively. Show Answer Correct Answer: C) Financial literacy is the ability to make informed and effective decisions regarding financial resources. 3. The main purpose of Bank Negara is to ..... A) Invest in property. B) Print money. C) Grants loans. D) Accept deposits from the public. Show Answer Correct Answer: B) Print money. 4. Aherrar A) To save. B) Account. C) To pay with cash. D) Bank. Show Answer Correct Answer: A) To save. 5. In relation to the other options, how liquid is a savings account? A) More liquid than cash. B) Less liquid than mutual funds. C) More liquid than a Certificate of Deposit. D) More liquid than a checking account. Show Answer Correct Answer: C) More liquid than a Certificate of Deposit. 6. What is the difference between a debit card and a credit card? A) A debit card uses your own funds; a credit card allows borrowing. B) A debit card can only be used internationally, while a credit card is for domestic use. C) A debit card is only for online purchases; a credit card is for in-store use. D) A debit card has a higher interest rate than a credit card. Show Answer Correct Answer: A) A debit card uses your own funds; a credit card allows borrowing. 7. When the RBI increases CRR, banks must keep more money safe and can lend less. What happens to lending? A) It goes down. B) It goes up. C) It stays the same. D) None of the above. Show Answer Correct Answer: A) It goes down. 8. Repo rate is the rate when banks borrow from the RBI against securities. What does a higher repo rate make borrowing? A) More costly. B) More tasty. C) More colorful. D) None of the above. Show Answer Correct Answer: A) More costly. 9. Which was first? A) Paper money. B) Coined money. C) All the above. D) None of the above. Show Answer Correct Answer: B) Coined money. 10. Credit creation by commercial banks depends upon A) Amount of initial deposit. B) Value of LRR. C) Amount of currency in circulation. D) Both a and b. Show Answer Correct Answer: D) Both a and b. 11. Which one is the difficulty of the Barter System? A) Lack of Double Coincidence. B) Difficulty of Division of the Goods. C) Lack of General Acceptable Measure of Value. D) All the above. Show Answer Correct Answer: D) All the above. 12. What should you always get after buying something? A) Candy. B) A receipt. C) Balloons. D) Stickers. Show Answer Correct Answer: B) A receipt. 13. The President admitted taking ..... and had to resign. A) Bribes. B) Fees. C) Fines. D) Premiums. Show Answer Correct Answer: A) Bribes. 14. Overdraft protection ..... A) Allows you to withdraw more money than you have in your account. B) Protects your account from unauthorized transactions. C) Helps you save money for emergencies. D) Provides insurance for your deposits. Show Answer Correct Answer: A) Allows you to withdraw more money than you have in your account. 15. If the value of LRR is halved, money created by banks will A) Also become half. B) Double. C) Remain constant. D) Increase by 4 times. Show Answer Correct Answer: B) Double. 16. Money that can be directly used for transaction is ..... A) Near money. B) Broad money. C) M1. D) M2. Show Answer Correct Answer: C) M1. 17. What characteristic of money helps it keep its value and deters inflation? A) Portability. B) Uniformity. C) Limited supply. D) Acceptability. Show Answer Correct Answer: C) Limited supply. 18. Which type of interest rate is generally considered to be riskier? A) Fixed. B) Variable. C) All the above. D) None of the above. Show Answer Correct Answer: B) Variable. 19. A barter economy is where something is accepted in payment for a debt A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 20. Which is NOT one of the main jobs of the Federal Reserve? A) Regulating the banks. B) Maintaining financial stability. C) Adjusting taxes when needed. D) Setting monetary policy. Show Answer Correct Answer: C) Adjusting taxes when needed. 21. What is characteristic of a credit union? A) Open to anyone. B) Membership qualifications. C) No physical locations. D) Non-profit. Show Answer Correct Answer: B) Membership qualifications. 22. What is the reserve deposit ratio (rdr)? A) The proportion of money RBI lends to commercial banks. B) The proportion of total deposits commercial banks keep as reserves. C) The total proportion of money that commercial banks lend to the customers. D) None of the above. Show Answer Correct Answer: B) The proportion of total deposits commercial banks keep as reserves. 23. How does the repo rate affect monetary policy? A) The repo rate influences borrowing costs, spending, and investment, thereby shaping monetary policy. B) The repo rate is solely determined by international markets. C) The repo rate only affects government spending, not private investment. D) The repo rate has no impact on inflation rates. Show Answer Correct Answer: A) The repo rate influences borrowing costs, spending, and investment, thereby shaping monetary policy. 24. Which of the following is a function of money? A) Acceptability. B) Medium of exchange. C) Portability. D) Relatively scarce. Show Answer Correct Answer: B) Medium of exchange. 25. Paying a bank to let you borrow money A) Loan. B) Interest. C) Inflation. D) Reserve. Show Answer Correct Answer: A) Loan. ← 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