Money and Credit Test

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Money and Credit Test - 15

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Weekly Quiz Competition

Question 1
1 / -0

The most important reason for an investor to prefer a Bank deposit is _________.

A
The credit worthiness of the Bank.

B
The Bank does not invest in the securities.

C
The Bank offers a guarantee.

D
All of the above.

Solution

Creditworthiness is how a lender determines that you will default on your debt obligations, or how worthy you are to receive new credit. Your creditworthiness is what creditors look at before they approve any new credit to you.
Banks offer lower interest rates on saving account as compared to term deposits. It is because of this reason, investors opt for term deposit accounts.
Question 2
1 / -0

The power of the commercial banks to expand deposits through expanding their loans and advances is known as which of the following?

A
Capital Expansion

B
Credit Expansion

C
Credit Control

D
Credit Creation

Solution

Credit creation is the expansion of deposits, banks can expand their demand deposits as a multiple of their cash reserves because demand deposits serve as the principal medium of exchange.
Hence the power of the commercial banks to expand deposits through expanding their loans and advances is known as credit creation.
Question 3
1 / -0

Which of the following is not an institutional credit agency?

A
Cooperative Society

B
Moneylender

C
Commercial Banks

D
Regional Rural Banks

Solution

Moneylenders are informal finance providers who are not registered under the government, as such, they fall under non-institutional credit agency.
They may be rich farmers, friends or relatives from whom a person takes a loan on oral basis.
Question 4
1 / -0

As published in various newspapers, the Experian Credit Information Company of India is going to launch its operation in India soon. At present the only credit information bureau functional in India is

A
AMFI

B
ICRA

C
CIBIL

D
CRISIL
Question 5
1 / -0

Which of the following is known as Plastic money?
A. Demand Draft
B. Credit Card
C. Debit Card

A
Only (A)

B
Only (B)

C
Only (C)

D
Both (B) and (C)

Solution

Plastic money is a term that is used predominantly in reference to the hard plastic cards we use every day in place of actual bank notes.
There are different types of plastic money, some of which are Credit Cards, Charged Cards, Premium Cards, Smart Cards, Debit Cards, ATM Cards etc.
Question 6
1 / -0

Which of the following is part of the process of money laundering?

A
Placement of funds

B
Layering of funds

C
Integration of funds

D
All of a), b) and c)
Question 7
1 / -0

Consider the following statement:
1. According to the provisions of FEMA, $$1999$$, cash in the form of coins and bank notes are included in 'Currency Notes'
2. According to the FEMA's provisions, ATM cards are not included in currency.
3. All 'money orders' can be treated as 'currency'.
Which of the above statement/s is/ are not true?

A
Only $$1$$

B
Only $$2$$

C
$$1$$ and $$3$$

D
Only $$3$$

Solution

Option B is the correct one.
Currency” includes all currency notes, postal notes, postal orders, money orders, cheques, drafts, traveler's cheques, letters of credit, bills of exchange and promissory notes, credit cards or such other similar instruments, as may be notified by the Reserve Bank.
Currency notes” means and includes cash in the form of coins and banknotes.
Question 8
1 / -0

The working group set up by the RBI has suggested the launch of an Emergency Fund Facility Scheme for banks. This scheme will help which of the following types of banks?

A
Public Sector Banks

B
Small Banks

C
Urban Cooperative Banks

D
Private Banks
Question 9
1 / -0

Which of the following is considered an informal method of getting credit/finance?

A
Internet banking

B
Branch visits

C
Going to moneylenders

D
Telebanking

Solution

Money lenders give a loan at a higher rate. The local moneylenders, relatives, friends and finance companies that grant a loan to the people in need at higher interest rates are informal lenders of credit.
Question 10
1 / -0

Which of the following is not the part of the scheduled banking structure in India?

A
Money lenders

B
Public sector nanks

C
Private sector banks

D
Regional rural banks

Solution

Money lenders give a loan at a higher rate. The local moneylenders, relatives, friends and finance companies that grant a loan to the people in need at higher interest rates are informal lenders of credit.

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Re-Attempt Weekly Quiz Competition

Money and Credit Test - 15

Result

Money and Credit Test - 15

Score

-

Rank

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SHARING IS CARING

Question 1

The credit worthiness of the Bank.

The Bank does not invest in the securities.

The Bank offers a guarantee.

All of the above.

Solution

Question 2

Capital Expansion

Credit Expansion

Credit Control

Credit Creation

Solution

Question 3

Cooperative Society

Moneylender

Commercial Banks

Regional Rural Banks

Solution

Question 4

AMFI

ICRA

CIBIL

CRISIL

Question 5

Only (A)

Only (B)

Only (C)

Both (B) and (C)

Solution

Question 6

Placement of funds

Layering of funds

Integration of funds

All of a), b) and c)

Question 7

Only $$1$$

Only $$2$$

$$1$$ and $$3$$

Only $$3$$

Solution

Question 8

Public Sector Banks

Small Banks

Urban Cooperative Banks

Private Banks

Question 9

Internet banking

Branch visits

Going to moneylenders

Telebanking

Solution

Question 10

Money lenders

Public sector nanks

Private sector banks

Regional rural banks

Solution

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