This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 3 Money And Banking – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 3 Money And Banking Quiz 7 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What does the phrase a medium of exchange mean when describing a function of money? A) Price of an item can be measured in terms of money units. B) Money is generally accepted means of payment. C) You can save money because it keeps its value. D) Borrowers know how much they need to pay back on a loan. Show Answer Correct Answer: B) Money is generally accepted means of payment. 2. Two units of the same type of money must be the same in terms of what they will buy, which is the principle of A) Functionality. B) Pricing. C) Value. D) Uniformity. Show Answer Correct Answer: D) Uniformity. 3. The principal lender-savers are A) Governments. B) Businesses. C) Households. D) Foreigners. Show Answer Correct Answer: C) Households. 4. A(n) ..... is a bank that can lend money to other banks in times of need. A) Credit union. B) Savings and loan. C) Central bank. D) Federal Reserve. Show Answer Correct Answer: C) Central bank. 5. What is the largest source of income for banks? A) The interest they receive from loans. B) Fees charged to customers for accounts. C) Money deposited in savings accounts. D) Special accounts such as NOW accounts. Show Answer Correct Answer: A) The interest they receive from loans. 6. Holds its value over a period of time A) Medium of Exchange. B) Barter. C) Money. D) Store of Value. Show Answer Correct Answer: D) Store of Value. 7. What is the origin of the American dollar? A) The Austrian taler and wampum. B) The Spanish peso and shillings. C) Wampum and shillings. D) The Spanish peso and Austrian taler. Show Answer Correct Answer: D) The Spanish peso and Austrian taler. 8. ..... refers to coins and paper bills used as money. A) Money. B) Currency. C) Barter. D) Greenbacks. Show Answer Correct Answer: B) Currency. 9. Coins and paper that are used as money; 'legal tender'. A) Money. B) Transfer Payments. C) Currency. D) Liquidity. Show Answer Correct Answer: C) Currency. 10. Which of the following is not a tools of credit control? A) CRR. B) SLR. C) Moral suasions. D) Managed floting. Show Answer Correct Answer: D) Managed floting. 11. Tools of monetary policy are ..... A) OMO. B) Interest rate. C) Discount rate. D) All of above. Show Answer Correct Answer: D) All of above. 12. In the context of money supply management by the RBI, the Statutory Liquidity Ratio (SLR) mandates commercial banks to hold a specified percentage of their deposits in the form of: A) Foreign currency and gold only. B) Cash with the RBI only (CRR). C) Cash, gold, or other securities approved by the RBI. D) Fixed deposits with other commercial banks. Show Answer Correct Answer: C) Cash, gold, or other securities approved by the RBI. 13. Sophia, Evelyn, and David are playing a game of 'Bank Manager'. They are discussing the main function of a commercial bank. Can you help them out? A) Provide investment advice and manage portfolios. B) Accept deposits and provide loans. C) Issue credit cards and process payments. D) Offer insurance products and services. Show Answer Correct Answer: B) Accept deposits and provide loans. 14. Which of the following is an example of fiduciary money? A) Coins. B) Debit card. C) Cheques. D) None of these. Show Answer Correct Answer: C) Cheques. 15. The following are functions of money, EXCEPT? A) A store of value. B) A unit of account. C) A medium of exchange. D) A shelter against inflation. Show Answer Correct Answer: D) A shelter against inflation. 16. What is the role of the Reserve Bank of India (RBI) in the Indian economy? A) To issue currency. B) To control money supply. C) To act as a lender of last resort. D) All of the above. Show Answer Correct Answer: D) All of the above. 17. When a bank is about to collapse, A) Up to $ 10, 000 can be paid to depositors. B) Up to $ 10, 000 can be paid to shareholders. C) The FDIC may secretly seize the bank. D) The FDIC must publicly seize the bank. Show Answer Correct Answer: C) The FDIC may secretly seize the bank. 18. Which of the following is an intangible asset? A) Savings. B) Offices. C) Land. D) Houses. Show Answer Correct Answer: A) Savings. 19. Function of money which is increasingly popular today A) Medium of exchange. B) Store of value. C) Measure of value. D) Standard of deferred payment. Show Answer Correct Answer: D) Standard of deferred payment. 20. "Ariana Rose purchases a new computer from the MYT Computer and paid by credit card." Based on the statement, choose the appropriate money function. A) A store of value. B) A measure of value. C) A medium of exchange . D) A standard of deferred payment tools. Show Answer Correct Answer: D) A standard of deferred payment tools. 21. What is the agency responsible for collecting taxes at the Federal level? A) Security and Exchange Commission (SEC). B) Internal Revenue Service (IRS). C) Consumer Financial Protection Bureau. D) Federal Reserve System (FED). Show Answer Correct Answer: B) Internal Revenue Service (IRS). 22. In India there are four alternative measures of money supply:M1, M2, M3, and M4 of these M1= A) Currency with people. B) Currency with people+ Demand deposdit. C) Currency with people+ Demand deposdit+ Other deposit with RBI. D) None of these. Show Answer Correct Answer: C) Currency with people+ Demand deposdit+ Other deposit with RBI. 23. Something accepted by all parties as payment for goods and services A) Money. B) Medium of exchange. C) Measure of value. D) Fiat money. E) Specie. Show Answer Correct Answer: B) Medium of exchange. 24. Adi is looking to open a bank account and wants to ensure that the bank he chooses operates in accordance with Islamic financial regulations. He is particularly interested in a bank that uses a profit-sharing system instead of charging interest. Which type of bank should Adi consider? A) Conventional Bank. B) Commercial Bank. C) Sharia Bank. D) People's Credit Bank. Show Answer Correct Answer: C) Sharia Bank. 25. Credit union A) Money placed into an account. B) Nonprofit financial institution that is privately owned and provides banking services for its members. C) Financial institution that offers savings and loan services. D) Financial institution that does not accept deposits. Show Answer Correct Answer: B) Nonprofit financial institution that is privately owned and provides banking services for its members. ← 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 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