This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 56 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 56 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The primary role of the Federal Reserve Bank is to steer the economy by A) Controlling the budget. B) Setting spending levels. C) Controlling the money supply. D) Loaning out money. Show Answer Correct Answer: C) Controlling the money supply. 2. What do digital payment options like UPI and NEFT provide? A) Physical cash transactions. B) Loan approvals. C) Convenient and efficient banking. D) Barter exchanges. Show Answer Correct Answer: C) Convenient and efficient banking. 3. What is the meaning of "afford" ? A) Have enough money to pay for something. B) Have enough food to survive. C) Paying. D) Buying. Show Answer Correct Answer: A) Have enough money to pay for something. 4. Which of the following is NOT an example of M1 money? A) Travelers' checks. B) A checking account. C) Currency. D) Mutual fund. Show Answer Correct Answer: D) Mutual fund. 5. This is a system where a reserve, or part, of a deposit needs to be kept on hand. A) Aggregate Measures. B) Fractional reserve system. C) Multiplier effect. D) Primary reserve. Show Answer Correct Answer: B) Fractional reserve system. 6. What are some different types of investments? A) Investing in a new business. B) Some different types of investments include stocks, bonds, mutual funds, real estate, and commodities. C) Types of investments include collecting rare coins. D) Purchasing luxury items. Show Answer Correct Answer: B) Some different types of investments include stocks, bonds, mutual funds, real estate, and commodities. 7. Legal Reserve Requirement includes A) Cash reserve ratio. B) Statutory reserve ratio. C) Both CRR and SLR. D) Government securities. Show Answer Correct Answer: C) Both CRR and SLR. 8. U.S. money today has value because the government has ordered it as acceptable means to pay debts. A) Representative money. B) Currency. C) Commodity money. D) Fiat money. Show Answer Correct Answer: D) Fiat money. 9. Pedir un prestamo A) To cash in a check. B) To play off debt. C) Bank. D) To apply for a loan. Show Answer Correct Answer: D) To apply for a loan. 10. Statistical definitions of Supply of Money:Currency in circulation and overnight deposits. Currency = bank notes + coins. A) M1. B) M2. C) M3. D) None of the above. Show Answer Correct Answer: A) M1. 11. A monetary system in which paper money and coins are equal to the value of a certain amount of gold A) Money Supply. B) Gold Standard. C) National Bank. D) Bank. Show Answer Correct Answer: B) Gold Standard. 12. Which of the following statements is true about the Indian monetary system? A) The Indian monetary system is based on the gold standard. B) The Indian monetary system is based on the credit money standard. C) The Indian monetary system is based on the minimum reserve system. D) The Indian monetary system is based on the metallic standard. Show Answer Correct Answer: C) The Indian monetary system is based on the minimum reserve system. 13. Which of the following is a tool used by the central bank to control money supply? A) Taxation. B) Open Market Operations. C) Public Expenditure. D) Import Tariffs. Show Answer Correct Answer: B) Open Market Operations. 14. Michael, Abigail, and Luna are planning to start a small business. They need a bank that primarily serves individuals and small businesses. Which type of bank should they approach? A) Retail bank. B) Central bank. C) Investment bank. D) Commercial bank. Show Answer Correct Answer: A) Retail bank. 15. How does exchange with money differ from barter? A) Exchange with money is more flexible and efficient than barter. B) Barter is always faster than using money. C) Money is less widely accepted than barter. D) Barter requires a currency exchange. Show Answer Correct Answer: A) Exchange with money is more flexible and efficient than barter. 16. A person makes $ 500 a week and receives a paycheck of $ 447. The amounts of $ 500 and $ 447 represent the person's ..... and ..... A) Gross pay; net pay. B) Net Pay; commission. C) Hourly rate; wages. D) Bonus; take home pay. Show Answer Correct Answer: A) Gross pay; net pay. 17. With rationing of credit, supply of money is reduced A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 18. Who prints money in India? A) Finance Ministry. B) Central Bank of India. C) State Bank of India. D) Reserve Bank of India. Show Answer Correct Answer: D) Reserve Bank of India. 19. The loan a bank gives you to purchase a house is called a ..... A) Mortgage. B) Default Loan. C) Equity Loan. D) Building Loan. Show Answer Correct Answer: A) Mortgage. 20. What do we call paper money? A) Bills. B) Leaves. C) Pages. D) Cards. Show Answer Correct Answer: A) Bills. 21. All of the following are examples of M2 EXCEPT A) Savings deposits. B) Demand deposits. C) Small denomination time deposits. D) The total of all M1. Show Answer Correct Answer: B) Demand deposits. 22. ..... is the rate at which commercial banks borrow short term funds from the central bank by selling their financial securities to the central bank A) CRR. B) SLR. C) Bank rate. D) Repo rate. Show Answer Correct Answer: D) Repo rate. 23. Find money multiplier if initial deposit of Rs.200 crore lead to creation of total deposits of Rs 1600 crores A) 5. B) 6. C) 8. D) 4. Show Answer Correct Answer: C) 8. 24. Which of the following agency is responsible for issuing Rs. 1 currency notes? A) Reserve bank of India. B) Ministry of Finance. C) Ministry of Commerce. D) Niti Aayog. Show Answer Correct Answer: B) Ministry of Finance. 25. What is the purpose of the Bank Rate set by the Central Bank? A) To control inflation. B) To regulate interest rates in the economy. C) To limit the amount of credit creation by banks. D) To stabilize the stock market. Show Answer Correct Answer: B) To regulate interest rates in the economy. ← 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