Banking & Currency
1. Which of the following are under the purview of Industrial Development Bank of India?
1. Unit Trust of India
2. Life Insurance Corporation of India
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3. Export-Import Bank
4. State Finance Corporation of India (a) 1, 2 & 3 (b) 2, 3 & 4 (c) 1, 3 & 4 (d) 1, 2 & 4
2. ‘Devaluation’ means (R.R.B. 1992)
(a) Converting rupees into gold
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(b) Lowering of the value of one currency in comparison of some foreign currency
(c) Making rupee dearer in comparison to some foreign currency
(d) None of these
3. Stagflation implies a case of (C.D.S. 1992)
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(a) Galloping inflation (b) Recession plus inflation
(c) Adverse balance of trade (d) rising wages and employment
4. One rupee currency notes bear the signature of
(a) Prime Minister of India (b) President of India
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(c) Finance Minister of India (d) Finance Secretary of India
5. Monetary policy is regulated by (Stenographers’ Exam, 1992)
(a) Money lenders (b) Central Bank
(c) Private entrepreneurs (d) Government policy
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6. The cause of inflation is
(a) Increase in money supply
(b) Fall in production
(c) Increase in money supply & fall in production
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(d) Decrease in money supply & fall in production
7. Ten rupee notes bear the signature of
(a) President
(b) Finance Minister
(c) Secretary, Ministry of Finance
(d) Governor, Reserve Bank of India
8. Which of the following public sector banks has the largest number of loss making branches ? (Bank, P.O. 94)
(a) State Bank of India (b) Indian Bank
(c) United Bank of India (d) Syndicate Bank
(e) United Commercial Bank
9. A crossed cheque is one, which can be encashed only (I.F.S.1991)
(a) By the drawee
(b) Through a bank
(c) At the State Bank of India
(d) After it has been transferred to another person
10. Which of the following is not true about the Reserve Bank of India?
(a) It formulates the monetary policy of India
(b) It regulates the currency and credit system of India
(c) It maintains the exchange value of the rupee
(d) Foreign exchange reserves are kept by RBI
(e) One rupee notes and coins are issued by RBI
11. In which of the following banks one cannot open a personal account?
(a) Commercial Bank (b) Cooperative Banks
(c) Scheduled Banks (d) Reserve Bank of India
12. Who among the following is most benefitted from inflation? (I.A.S. 1989)
(a) Government pensioners
(b) Creditors
(c) Savings Bank Account holders
(d) Debtors
13. Which of the following is the Banker of the Banks? (Railways, 1995)
(a) IDBI (b) SBI
(c) RBI (d) SBI and RBI
14. When does the problem of unfavourable balance of payment arise? (Stenographers’ Exam, 94)
(a) When exports decrease (b) When exports increase (c) When imports decrease (d) When imports are greater than exports
15. Land Development Bank (S.C.R.A. Exam. 1996)
(a) Refinances the Primary Cooperative Societies
(b) Finances projects for the development of rural housing
(c) Provides medium and long-term loans to farmers for land improvements and purchase of implements
(d) Aids the State Government in land reclamation, soil conservation etc
16. The Government’s gold auction policy was aimed at
(a) Price stabilization
(b) Making gold available to consumers
(c) Promoting jewellery exports
(d) Checking 0f smuggling and reducing the budgetary deficit of Central
Government
17. The largest Public Sector Bank in India is (C.D.S. 1991)
(a) Central Bank (b) State Bank of India
(c) Punjab National Bank (d) Indian Overseas Bank
18. When was the IDBI (Industrial Development Bank of India) instituted?
(a) 1981 (b) 1972
(c) 1964 (d) 1952
19. Consider the following statements regarding Reserve Bank of India (Civil Services. 2001)
(a) It is a banker to the Central Government
(b) It formulates and administers monetary policy
(c) It acts as an agent of the Government in respect of India’s membership of IMF
(d) It handles the borrowing programme of Government of India which of these statements are correct
(a) A and B (b) B, C and D
(c) A,B,C and D (d) C and D
20. The National Housing Bank is a subsidiary of (S.B.I.P.0.1991)
(a) Reserve Bank of India (b) NABARD
(c) Unit Trust of India (d) Life Insurance Corporation of India
21. Which of the following is not an affiliate of the Reserve Bank of India?
(a) Unit Trust of India
(b) The Industrial Development Bank of India
(c) Agricultural Refinance Corporation
(d) Deposit Insurance Corporation
22. Which of the following can be used for checking inflation temporarily? (Stenographers’ Exam, 90)
(a) Increase in wages (b) Decrease in money supply
(c) Decrease in taxes (d) none of these
23. The basic regulatory authority for mutual funds and stock markets lies with the (Assistant Grade, 1994)
(a) Government of India
(b) Reserve Bank of India
(c) Securities and Exchange Board of India
(d) Stock Exchanges
24. A currency whose exchange rate tends to fall because of persistent balance of payment deficit is known as
(a) Soft Currency (b) Hard Currency
(c) Sinking Currency (d) Gold Currency
25. The National Bank for Agriculture and Rural Development (NABARD) was set up in
(a) 1977 (b) 1980
(c) 1982 (d) 1984
26. What is the correct sequence of the following? (I.F.S. 1991)
1. Lead Bank 2. Regional Rural Banks 3. Loan Melas (a) 1, 2, 3 (b) 1, 3, 2
(c) 2, 3, 1 (d) 3, 2, 1
27. When was the Reserve Bank of India taken over by the Government? (P.C.S. 1994)
(a) 1945 (b) 1948
(c) 1952 (d) 1956
28. under the Lead Bank Scheme, a bank was expected to adopt a
(a) Village (c) District
(b) Town (d) State
29. Who is responsible for the collection & publication of monetary and financial information?
(a) Finance Commission
(b) Finance Ministry
(c) Reserve Bank of India
(d) Auditor and Comptroller General of India.
30. the Imperial Bank of India, after nationalization, was given the name of
(a) Reserve Bank of India (b) Bank of India
(c) State Bank of India (d) Indian Overseas Bank
31. Inflation implies (Railways, 1994)
(a) Rise in budget deficit
(b) Rise in money supply
(c) Rise in general price index
(d) Rise in prices of consumer goods
32. Regional Rural Banks are designed to work in which of the following ideals? (I-A.S. 1988)
(a) Work on basics of commercial banks
(b) Help the targeted groups
(c) Keep lending rates lower than cooperative institutions
(d) Work on innovative and adaptive ideals
33. Commercial Banking System in India is
(a) Mixed Banking (b) Unit Banking
(c) Branch Banking (d) None of the Above
34. Which of the following factors contributes to an inflationary trend?
(a) 15% fall in production of industrial goods
(b) 15% increase in prices of agricultural products
(c) 15% increase in supply of money in the market
(d) None of these
35. The Reserve Bank of India issues (Stenographers’ Exam, 1994)
(a) All the currency notes
(b) All the currency notes except the one rupee note
(c) All the currency notes except the hundred rupee note
(d) Only notes of Rs. 10 and above
36. The value of which of the following foreign currencies is maximum in terms of rupees ? (Hotel Management 1998)
(a) British Pound (b) Dinar
(c) Riyal (d) US Dollar
37. Bank Rate means
(a) Interest Rate charged by Scheduled Banks.
(b) Official rate of interest charged by the Central Bank of a country.
(c) Rate of profit of the Banking Institutions.
(d) Interest rate charged by money lenders.
38. If the cash reserve ratio is lowered by the Central bank, what will be its effect on credit creation?
(a) Decrease (b) Increase
(c) No change (d) none of these
39. Reserve Bank of India, as the Central Bank of the country, performs which of the following functions? (ND.A. 1991)
1. It is the bank of Issue
2. It acts as banker to the government
3. It regulates the flow of credit
4. It maintains the internal value of the rupee (a) 2 and 3 (b) 4 only
(c) 1, 2 and 4 (d) 1, 2 and 3
40. Deficit financing creates additional paper currency to fill the gap between expenditure and revenue. This device aims at economic development but if it fails, it generates (T.F.S. 1990)
(a) Inflation (b) Devaluation
(c) Deflation (d) Demonetization
41. When was the decimal system of currency introduced in India? (P.C.S. 1994)
(a) 1948 (b) 1950
(c) 1954 (d) 1957
42. Which of the following prints currency notes of the denomination of Rs. 100?
(a) The Bank Note Press, Dewas
(b) The Indian Security Press, Nasik Road
(c) The Security Printing Press, Hyderabad
(d) All the above
43. The highest denomination of currency notes in circulation as legal tender in India is at present
(a) Rs. 50 (b) Rs. 100
(c) Rs. 500 (d) Rs. 1000
44. The special paper required for printing of currency notes by the Security Presses in the country is manufactured at
(a) Hyderabad (b) Kolkata
(c) Hoshangabad (d) Dewas
45. Which of the following mints undertakes refining of gold for licensed gold dealers and production of medals for defence services?
(a) The Hyderabad Mint (b) The Mumbai Mint (c) the Kolkata Mint (d) None of these
46. Which of the following is not an asset held by commercial banks?
(a) Bills of exchange
(c) Current account deposits
(d) Credit balances with the Reserve Bank (d) Money lent at short notice
47. The primary objective to Unit Trust of India is
(a) To assist the industries *n financial difficulties
(b) To diffuse the benefit of development among the masses
(c) To accumulate funds for public investment expenditure
(d) To promote the investment habit among those who have not been able to diversify investment risk
48. Reserve Bank of India was set up in (R.R.B. 1994)
(a) 1935 (b) 1949
(c) 1951 (d) 1955
49. Inflation can be contained by (Assistant Grade, 1992)
(a) Surplus budget
(b) Increase m taxation
(c) Reduction in public expenditure
(d) All the above
50. The Reserve Bank of India issues currency notes under the (S.C.C. 2001)
(a) Fixed fiduciary system
(b) Maximum fiduciary system
(c) Minimum reserve system
(d) Proportional reserve system
ANSWERS
l.(b) 2.(b) 3.(b) 4.(d) 5.(d) 6.(c) 7. (d) 8. (d) 9(b) 10.(e)
11.(d) 12.(d)
21.(b) 22.(b)
31. (c) 32. (b)
41. (b) 42(a)
13. (c) 14. (d)
23. (c) 24. (a)
33. (a) 34. (c)
43. (d) 44. (c)
15.(c) 16. (d)
25. (c) 26. (a)
35. (b) 36. (a)
45. (b) 46. (b)
17. (b) 18. (c)
27. (b) 28. (c)
37.(b) 38.(b)
47.(d) 48.(a)
19. (c) 20. (a)
29. (c) 30. (c)
39. (d) 40. (a)
49. (d) 50. (c)