This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 54 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 54 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is TRUE about banks and credit unions? A) Banks are for-profit institutions, while credit unions are non-profit. B) Banks offer higher interest rates on savings accounts than credit unions. C) Credit unions are insured by the FDIC, while banks are not. D) Banks are owned by their customers, while credit unions are owned by shareholders. Show Answer Correct Answer: A) Banks are for-profit institutions, while credit unions are non-profit. 2. Fiat currency that must be accepted in payment for debts A) Monetary standard. B) Legal tender. C) Treasury coin notes. D) Gold standard. E) Inconvertible fiat money standard. Show Answer Correct Answer: B) Legal tender. 3. Which is a TRUE statement about banks. A) Limited Losses if your debit card disappears. B) The Federal Deposit Insurance Corporation (FDIC) insures customers' money. C) Deposits are insured by the National Credit Union Administration (NCUA). D) None of the above. Show Answer Correct Answer: B) The Federal Deposit Insurance Corporation (FDIC) insures customers' money. 4. ..... is another word for trading. A) Service. B) Bartering. C) Charities. D) Good. Show Answer Correct Answer: B) Bartering. 5. If CRR = 20% and deposits are Rs 100, maximum loans possible are: A) Rs 80. B) Rs 20. C) Rs 100. D) Rs 120. Show Answer Correct Answer: A) Rs 80. 6. Which is an example of 'store of value' A) Purchasing items with token money. B) Borrowing money from a friend. C) Exchanging money foor goods and services. D) Saving money in a bank for future use. Show Answer Correct Answer: D) Saving money in a bank for future use. 7. ..... refers to objects that have value in themselves and that are also used as money. A) Fiat money. B) Gold standard. C) Commodity money. D) Savings and loan. Show Answer Correct Answer: C) Commodity money. 8. Who among the following issues Re.1 currency note? A) President. B) Prime Minister. C) RBI. D) Ministry of Finance, Government of India. Show Answer Correct Answer: D) Ministry of Finance, Government of India. 9. Commodity money can be best defined as ..... A) An items that serves the function of money but has no value as anything else. B) An item that serves the function of money and also has other uses. C) The price of currency in relation to another. D) All of the above. Show Answer Correct Answer: B) An item that serves the function of money and also has other uses. 10. What were early forms of money? A) Bank notes. B) Credit cards. C) Digital currencies. D) Grains, cattle, and precious metals. Show Answer Correct Answer: D) Grains, cattle, and precious metals. 11. Other things being equal, a decrease in the money supply is likely to ..... A) Reduce interest rate. B) Increase bond price. C) Increase the velocity of money. D) Increase holding of liquidity assets. Show Answer Correct Answer: A) Reduce interest rate. 12. A financial action taken today that will create financial benefits in the future? A) Portfolio. B) Maturity. C) Investment. D) Buying a Ski Doo. Show Answer Correct Answer: C) Investment. 13. What is the main source of income for commercial banks? A) Issuing currency. B) Selling foreign exchange. C) Extending loans and advances. D) Accepting deposits. Show Answer Correct Answer: C) Extending loans and advances. 14. What is the purpose of understanding the different kinds of financial institutions in Canada? A) To identify their role in the Canadian financial system and the services they offer. B) To determine which institution is the largest. C) To compare their interest rates. D) To evaluate their international presence. Show Answer Correct Answer: A) To identify their role in the Canadian financial system and the services they offer. 15. Why are doctors paid more than nurses A) They are smarter. B) They are poorer. C) They have high demand. D) None of the above. Show Answer Correct Answer: C) They have high demand. 16. When was the great recession? A) 1999. B) 2005. C) 2008. D) 2010. Show Answer Correct Answer: C) 2008. 17. Safe deposit boxes in a bank is used to ..... A) Clear the cheques. B) Keep valuable things. C) Access to internet banking. D) Transfer money to oversea. Show Answer Correct Answer: B) Keep valuable things. 18. Who is most likely to be hurt by inflation? A) Someone who borrowed money. B) A retiree on a fixed income. C) A business owner. D) The U.S. government. Show Answer Correct Answer: B) A retiree on a fixed income. 19. Rule stating that a percentage of every deposit be set aside as legal reserves A) Monetary policy. B) Discount rate. C) Reserve requirement. D) Margin requirements. Show Answer Correct Answer: C) Reserve requirement. 20. Value that is based on an opinion of a person, society, etc. is what type of value? A) Economic value. B) Intrinsic value. C) Subjective value. D) Speculative value. Show Answer Correct Answer: C) Subjective value. 21. What is the definition of money? A) It is a medium of exchange for the purchase of goods and services. B) It is a system of swapping items in exchange for another item. C) It is a system used to purchase goods only. D) It is a medium used to swap item with another trader. Show Answer Correct Answer: A) It is a medium of exchange for the purchase of goods and services. 22. Depositor-owned financial organization operated only for the benefit of its depositors A) Federal Reserve System. B) Thrift institution. C) Mutual savings bank. D) Credit union. E) Savings and loan association. Show Answer Correct Answer: C) Mutual savings bank. 23. What best describes electronic money? A) Physical currency used for online transactions. B) A digital form of fiat money accessible via computers and the internet. C) Money exclusively used through credit and debit cards. D) Funds that must be linked to a traditional bank account for exchange. Show Answer Correct Answer: B) A digital form of fiat money accessible via computers and the internet. 24. Bradley digs out $ 50 from his cookie jar and deposits it in his checking account. The immediate result of this transaction is that M1 has A) Increased by $ 50. B) Increased by more than $ 50. C) Increased by less than $ 50. D) Not changed. Show Answer Correct Answer: D) Not changed. 25. The potential amount of money that banks can create based on the initial deposit. A) Bank Failures. B) Money Multiplier. C) Potential Money Creation Formula. D) Open Market Operations. Show Answer Correct Answer: B) Money Multiplier. ← 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