Indian Economy Test 53

Result

Indian Economy Test 53

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Weekly Quiz Competition

Question 1
1 / -0

Consider the following statements about Sinking Fund
1) It is a method of repayment of public debt.
2) It is created by the government out of budgetary revenues every year.
Which of the statements given above is / are correct ?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2

Solution

A Sinking Fund is a means of repaying debt borrowed through a bond issue through periodic payments to a trustee. The money deposited in the Fund is used to retire preferred stocks and debentures. A Sinking Fund provides additional safeguards to the bond holders.
Question 2
1 / -0

Consider the following liquid assets
1 . Demand deposits with the banks
2 . Time deposits with the banks
3 . Saving deposits with the banks
4 . Currency
The correct sequence of these assets in the decreasing order of liquidity is

A
1-4-3-2

B
4-3-2-1

C
2-3-1-4

D
4-1-3-2
Question 3
1 / -0

Consider the following objectives:
1) To restrict the expansion of bank credit.
2) To augment the investment of the banks in government securities.
3) To ensure solvency of banks.
Which of the objectives given above are the main objectives of the Statutory Liquidity Requirements (SLRs)?

A
1 and 2

B
1 and 3

C
2 and 3

D
All of these

Solution

Statutory Liquidity Ratio (SLR) refers to the percentage of money which the banks have to set aside and invest in gold or RBI approved securities. It is maintained by the banks with themselves and restricts the banks' leverage in pumping more money into the economy. This is to ensure the solvency of banks and also augment the investment of the banks in Govt securities. SLR also restricts expansion of credit thereby controlling inflation.
Question 4
1 / -0

With reference to Gilt-edge Securities , consider the following statements
1) it is long term fixed-rate bonds.
2) It is very sensitive to changes in interest rates.
3) It is less demand in the market than the private commercial papers.
Which of the statements given above is / are correct ?

A
1 and 2

B
2 and 3

C
Only 2

D
All of these
Question 5
1 / -0

Consider the following statements
1 . Priority Sector Lending is started since the establishment of the Banking system in India.
2 . Priority Sector Lending is mainly aimed to give adequate assistance to those sector which contributed a significant proportion of national product.
Which of the statement given above is / are correct ?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2
Question 6
1 / -0

The terms 'Marginal Standing Facility Rate' and 'Net Demand and Time Liablities', sometimes appearing in news, are used in relation to _________________.

A
banking operation

B
communication networking

C
military Strategies

D
supply and demand of agricultural products

Solution

Marginal Standing Facility is a ruote created by the RBI (came in May 2011) under which banks can barrow maximum 1 per cent (fixed by the RBI) of their Net Demand and Time Liabilities (NDTL) from the RBI for one night. This works as an alternate ruote to the Repo but is costlier to it.
Question 7
1 / -0

Consider the following transactions
1) Payment between Nepal and India.
2) Payment between Bhutan and India.
Which of the payments given above is / are the payments not eligible for settlement though the Asian Clearing Union ?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2
Question 8
1 / -0

Consider the following statements:
1) In India , the Cash Reserve Requirement is between 3 to $$15\%$$ of the total demand and time deposits of the commercial banks.
2) In India , the Statutory Liquidity Requirement is not less than $$25\%$$ of the total demand and time deposits of commercial banks.
Which of the statements given above is/are correct about the General Credit Control measures used by the RBI?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2

Solution

In current times, the CRR in India remains around 4% of the total demand and time deposits while the SLR remains around 20% of the total demand and time deposits. These values may fluctuate depending upon the periodic monetary policy reviews of the RBI.
Question 9
1 / -0

Consider the following roles:
1) Bank of issue
2) Controller of credit
3) Supervision to bring sound banking
4) Banker to government
Which of the roles given above are the functions or roles of the Reserve bank of India?

A
1 and 2

B
1 and 3

C
1 , 2 and 4

D
All of these

Solution

RBI is the banker's bank and also the banker to the Govt. It is also the Bank of Issue as it has the responsibility of minting the currency under the RBI Act.

Through various mechanisms like SLR, CRR, LAF etc, it also controls the amount of credit and money supply. RBI also has the responsibility of regulating the banking sector and provides rules, regulations and guidelines in order to ensure sound banking in the country.
Question 10
1 / -0

Shishu , Kishor and tarun are the schemes of

A
Regional Rural Banks.

B
Micro Units Development and Refinance Agency Limited (MUDRA).

C
Small Industries Development Bank of India.

D
Industrial Development Bank of India.

Solution

The primary product of PM's 'Pradhan Mantri Mudra Yojana' will be providing refinance for lending to micro businesses. The interventions have been named 'Shishu', 'Kishor', and 'Tarun' to signify the stage of growth/development.

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Re-Attempt Weekly Quiz Competition

Indian Economy Test 53

Result

Indian Economy Test 53

Score

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Rank

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SHARING IS CARING

Question 1

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Solution

Question 2

1-4-3-2

4-3-2-1

2-3-1-4

4-1-3-2

Question 3

1 and 2

1 and 3

2 and 3

All of these

Solution

Question 4

1 and 2

2 and 3

Only 2

All of these

Question 5

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Question 6

banking operation

communication networking

military Strategies

supply and demand of agricultural products

Solution

Question 7

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Question 8

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Solution

Question 9

1 and 2

1 and 3

1 , 2 and 4

All of these

Solution

Question 10

Regional Rural Banks.

Micro Units Development and Refinance Agency Limited (MUDRA).

Small Industries Development Bank of India.

Industrial Development Bank of India.

Solution

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