Banking sector - Money Supply and Banks - MCQs with answers - Part 1
1. Who issues metallic coins in India?a. RBI
b. Government of India
c. Banks and financial institutions
d. Any of the above can issue it.
View Answer / Hide AnswerANSWER: b. Government of India
The Government of India issues metallic coins in India. Coins, paper currency and deposits are the components of money supply in India.
a. Currency notes
b. Coins
c. Both
d. None
View Answer / Hide AnswerANSWER: a. Currency notes
Currency notes are issued by RBI. The Government of India issues metallic coins in India.
i. Deposits are created by banks and financial institutions.
ii. They constitute the major source of money supply in India.
a. I only
b. ii only
c. both
d. none
View Answer / Hide AnswerANSWER: c. both
Coins, paper currency and deposits are the components of money supply in India.
a. M2= M1 +demand deposits with post offices
b. M3= M1 +term deposits with banks
c. M4=M3+total deposits with post offices
d. All the above
View Answer / Hide AnswerANSWER: d. All the above
These are the measures of money supply adopted by RBI in 1977.
a. M1
b. M2
c. M3
d. M4
View Answer / Hide AnswerANSWER: a. M1
M1= cash with the public+ demand deposits with banks+ other deposits with RBI
a. M1
b. M2
c. M3
d. M4
View Answer / Hide AnswerANSWER: c. M3
M3 is known as broad money as more items are included in this measure when compared to M1 which is known as narrow money.
a. M1= currency with public +demand deposits with banking system + other deposits with RBI
b. M2= M1 + savings deposits of post office savings bank
c. M3= M1+ time deposits with banking system
d. None of the above
View Answer / Hide AnswerANSWER: d. None of the above
M4= M3+ all deposits with post office savings banks excluding National Savings Certificate
i. Data on Mo are published on monthly basis
ii. Data on M1 and M3 are available on weekly basis
a. I only
b. ii only
c. both
d. none
View Answer / Hide AnswerANSWER: d. none
Data on Mo are published by the RBI on weekly basis and Data on M1 and M3 are available on fortnightly basis.
i. Data on liquidity aggregates L1 and L2 are published weekly
ii. Data on L3 are published once in a quarter.
a. i only
b. ii only
c. both
d. none
View Answer / Hide AnswerANSWER: b. ii only
Data on liquidity aggregates L1 and L2 are published on a monthly basis.
a. Vijaya Bank
b. Canara Bank
c. Bank of India
d. Central Bank of India
View Answer / Hide AnswerANSWER: a. Vijaya Bank
Vijaya Bank was nationalized in 1980 with 5 other banks. In 1969, 14 banks were nationalized.
