This quiz works best with JavaScript enabled. Home > Indian Economy > Basics > Currency And Inflation – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Currency And Inflation Quiz 2 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. An asset that the borrowers own, and use this as a guarantee to the lender, until the loan is repaid. A) Security. B) Collateral. C) Property. D) All of these. Show Answer Correct Answer: B) Collateral. 2. As per the latest released FSR, Indian Banking system has remained resilient mainly due to: A) Improvement in profitability. B) Adequate capital buffer. C) High level of non-performing loans. D) None of the above. Show Answer Correct Answer: B) Adequate capital buffer. 3. The exchange rate is A) The price of one currency relative to gold. B) The value of a currency relative to inflation. C) The change in the value of money over time. D) The price of one currency relative to another. Show Answer Correct Answer: D) The price of one currency relative to another. 4. The cause of inflation is: A) Increase in money supply. B) Fall in production. C) Increase in money supply and fall in production. D) Decrease in money supply and fall in production. Show Answer Correct Answer: C) Increase in money supply and fall in production. 5. Which of the following governmental steps has proved relatively effective in controlling the double digit rate of inflation in the Indian economy during recent years? A) Containing budgetory deficits and unproductive expenditure. B) Streamlined public distribution system. C) Enhanced rate of production of all consumer goods. D) Pursuing an export-oriented strategy. Show Answer Correct Answer: A) Containing budgetory deficits and unproductive expenditure. 6. Which one of the following is the main source of credit for rich urban households in India? A) Formal sector. B) Informal sector. C) Money lenders. D) Traders. Show Answer Correct Answer: A) Formal sector. 7. A financial institution which accepts deposits from public and provide loans to them. A) Share Market. B) Insurance Company. C) Banks. D) All of these. Show Answer Correct Answer: C) Banks. 8. An agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment. A) Credit(loan). B) Chit fund. C) Bank. D) Cheque. Show Answer Correct Answer: A) Credit(loan). 9. To meet the growing needs for coins in the country, where does the Government propose to set up another mint? A) Nasik. B) Hoshangabad. C) Dewas. D) Noida. Show Answer Correct Answer: D) Noida. 10. Number of Reserve Banks in a country is A) Two. B) Three. C) One. D) Five. Show Answer Correct Answer: C) One. 11. 'Devaluation' means: [RRB 1992] A) Converting rupee into gold. B) Lowering of the value of one currency in comparison of some foreign currency. C) Making rupee dealer in comparison to some foreign currency. D) None of these. Show Answer Correct Answer: B) Lowering of the value of one currency in comparison of some foreign currency. 12. What percentage of deposits are kept as cash by the commercial banks in India? A) 25%. B) 20%. C) 15%. D) 10%. Show Answer Correct Answer: C) 15%. 13. The latest released FSR refers to Bank for International Settlements (BIS) quarterly review ( Dec 2022). According to the BIS estimates US $ 80 trillion of dollar debt is " missing" , the missing debt as per BIS report is mainly in the form of: A) Government Bonds. B) FX Swaps. C) Private debt. D) Household debt. Show Answer Correct Answer: B) FX Swaps. 14. Inflation can be contained by: A) Surplus budget. B) Increase in taxation. C) Reduction in public expenditure. D) All the above. Show Answer Correct Answer: D) All the above. 15. 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 the above. Show Answer Correct Answer: B) The Mumbai Mint. 16. If Net capital flows led by foreign portfolio investment (FPI), foreign direct investment (FDI) and trade credit fell short of the funding requirements of CAD, it will result in: A) A depletion of foreign exchange reserves. B) An increase of foreign exchange reserves. C) Unchanged foreign exchange reserves. D) None of the above. Show Answer Correct Answer: A) A depletion of foreign exchange reserves. 17. The inflation experienced in the country at present is: A) Galloping inflation. B) Secondary inflation. C) Unrealistic inflation. D) Cost-push inflation. Show Answer Correct Answer: D) Cost-push inflation. 18. "Scheduled bank" in India means a bank ..... A) Incorporated under the Companies Act, 1956. B) Authorized to the Banking business. C) Governed by the Banking Regulation Act, 1949. D) Included in the Second schedule to the Reserve Bank of India Act 1934. Show Answer Correct Answer: D) Included in the Second schedule to the Reserve Bank of India Act 1934. 19. Which one of the following is an asset that the borrower owns and uses as a guarantee until the loan is repaid to the lender? A) Property. B) Money. C) Collateral. D) Deposits. Show Answer Correct Answer: C) Collateral. 20. A steady increase in the general level of prices as a result of excessive increase in aggregate demand as compared to aggregate supply is termed as : [CDS 1999] A) Demand-pull inflation. B) Cost-push inflation. C) Stagflation. D) Structural inflation. Show Answer Correct Answer: A) Demand-pull inflation. ← PreviousNext →Related QuizzesIndian Economy QuizzesCurrency And Inflation Quiz 1Currency And Inflation Quiz 3Currency And Inflation Quiz 4Currency And Inflation Quiz 5Currency And Inflation Quiz 6Currency And Inflation Quiz 7Currency And Inflation Quiz 8Lifelines Of Indian Economy QuizSectors Of The Indian Economy Quiz 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books