MCQs
Total Questions : 550
| Page 52 of 55 pages
Answer: Option D. -> All of the above
Answer: (d)
One of the reasons of rising in the prices of goods and services is due to increase in the money supply. An increase in money supply can be caused to the government increasing the expenditure or the government increasing the salaries. When RBI purchases government security from the public it pays money to the public and ultimately increases the money supply.
So, all the statements are true.
Answer: (d)
One of the reasons of rising in the prices of goods and services is due to increase in the money supply. An increase in money supply can be caused to the government increasing the expenditure or the government increasing the salaries. When RBI purchases government security from the public it pays money to the public and ultimately increases the money supply.
So, all the statements are true.
Answer: Option A. -> Both Bond and Stock holders
Answer: (a)
A creditor is a party (e.g. person, organization, company, or government) that has a claim to the services of a second party. It is a person or institution to whom money is owed. The second party is frequently called a debtor or borrower.
An incorporated entity is a separate legal entity that has been incorporated through a legislative or registration process established through legislation. Both bondholders and stockholders are creditors of a corporation.
Answer: (a)
A creditor is a party (e.g. person, organization, company, or government) that has a claim to the services of a second party. It is a person or institution to whom money is owed. The second party is frequently called a debtor or borrower.
An incorporated entity is a separate legal entity that has been incorporated through a legislative or registration process established through legislation. Both bondholders and stockholders are creditors of a corporation.
Answer: Option B. -> 1 only
Answer: (b)Certificate of Deposit (CD) and Commercial Paper (CP) markets were introduced by Reserve Bank of India in March 1989 in order to widen the range of money market instruments and give investors greater flexibility in the deployment of their shortterm surplus funds.
Answer: (b)Certificate of Deposit (CD) and Commercial Paper (CP) markets were introduced by Reserve Bank of India in March 1989 in order to widen the range of money market instruments and give investors greater flexibility in the deployment of their shortterm surplus funds.
Answer: Option B. -> Dollars and other hard currencies
Answer: (b)In international transactions, generally dollars and some other stable/hard currencies like Euro, Pound, Yen etc. are used/accepted. So, if there is a problem of international liquidity then it means non-availability of these hard currencies.
Answer: (b)In international transactions, generally dollars and some other stable/hard currencies like Euro, Pound, Yen etc. are used/accepted. So, if there is a problem of international liquidity then it means non-availability of these hard currencies.
Answer: Option C. -> (i) only
Answer: (c)
GDP (Output) is the final value of goods and services produced in the economy. But there are a lot of transactions that happen in the economy for intermediate goods, so the value of transactions is higher than the value of final output in the economy.
For example, suppose, I purchased Rs. 30 of input to produce Rs. 100 of the final output, which I sold in the market. GDP will be Rs. 100, while the value of transactions in the economy will be Rs. 130.
Since money keeps on moving between different hands, the same money is used for transacting again and again (also referred to as the velocity of circulation), so the money required for doing transactions will be less than the total value of transactions in the economy.
As of 13th March 2020, Money Supply in the economy was Rs. 165 lakh crores. While GDP of 2019-20 is expected to be Rs. 204.4 lakh crore. And the value of transactions is much more than the GDP.
Answer: (c)
GDP (Output) is the final value of goods and services produced in the economy. But there are a lot of transactions that happen in the economy for intermediate goods, so the value of transactions is higher than the value of final output in the economy.
For example, suppose, I purchased Rs. 30 of input to produce Rs. 100 of the final output, which I sold in the market. GDP will be Rs. 100, while the value of transactions in the economy will be Rs. 130.
Since money keeps on moving between different hands, the same money is used for transacting again and again (also referred to as the velocity of circulation), so the money required for doing transactions will be less than the total value of transactions in the economy.
As of 13th March 2020, Money Supply in the economy was Rs. 165 lakh crores. While GDP of 2019-20 is expected to be Rs. 204.4 lakh crore. And the value of transactions is much more than the GDP.
Question 516. Consider the following statements.
- The National Housing Bank, the apex institution of housing finance in India, was set up as a whollyowned subsidiary of the Reserve Bank of India.
- The Small Industries Development Bank of India was established as a wholly-owned subsidiary of the Industrial Development Bank of India.
Answer: Option C. -> Both 1 and 2
Answer: (c)
Answer: (c)
Answer: Option B. -> Reserve Bank of India
Answer: (b)RBI conducts quarterly 'inflation expectation survey' of households wherein RBI gauges the household’s expectation regarding inflation for the next one year. These surveys are used for monetary policy purpose.
Answer: (b)RBI conducts quarterly 'inflation expectation survey' of households wherein RBI gauges the household’s expectation regarding inflation for the next one year. These surveys are used for monetary policy purpose.
Answer: Option C. -> ICICI Bank
Answer: (c)
Answer: (c)
Answer: Option A. -> $\text"Broad Money"/\text"Reserve Money"$
Answer: (a)
Answer: (a)
Question 520. Which of the following statements will be considered as part of ‘Transfer Payments’ in the balance of payment?
Select the correct answer using the code given below:
- Gift sent by an NRI to his friend in India
- Money sent by an Indian employee to his family in India who has gone abroad temporarily
Select the correct answer using the code given below:
Answer: Option C. -> (i) only
Answer: (c)
BoP is basically transactions of the residents of the country with the rest of the world. And transfer payments mean anything given for free.
In the (i) statement, the transaction between Indian residents and Non-Resident Indians (NRI) is for free, without any work done or consideration. So, it is a case of transfer payment and will be recorded in BoP.
In the (ii) statement, the transaction is between an Indian resident (who has gone abroad temporarily) and his family in India. Both are Indian residents, so, this transaction will not be recorded in BoP.
Answer: (c)
BoP is basically transactions of the residents of the country with the rest of the world. And transfer payments mean anything given for free.
In the (i) statement, the transaction between Indian residents and Non-Resident Indians (NRI) is for free, without any work done or consideration. So, it is a case of transfer payment and will be recorded in BoP.
In the (ii) statement, the transaction is between an Indian resident (who has gone abroad temporarily) and his family in India. Both are Indian residents, so, this transaction will not be recorded in BoP.