Banking Financial Awareness · Economics

Banking Regulation and Monetary Policy

1,180 Questions

Banking regulation and monetary policy questions test your understanding of the Reserve Bank of India functions, regulatory frameworks, and monetary tools. Topics include KYC guidelines, repo rates, and foreign exchange reserves management. This section is crucial for candidates preparing for banking and financial awareness exams.

RBI monetary toolsKYC guidelinesInterest rate regulationsCurrency issuanceBanking business acts

Banking Regulation and Monetary Policy Questions

Multiple choice social science food security in india need for nregs rural development and employment guarantee scheme food security and nutrition

A short-term loan at least interest rate was made available to the farmers through _____________.

  1. Kisan Credit Card Yojna

  2. Krishak Udhyami Loan Yojana

  3. Unified Package Insurance Scheme

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Kisan Credit Card Yojna was formulated to provide short term loans to farmers for agricultural needs.The loan was provided at subsidized interest rates by the government if the borrower maintained a good credit history. An additional 2% subsidy was provided if the borrower managed a sound record during the term of the loan.

Multiple choice commercial studies basic accounting terms basic accounting terminologies introduction to financial accounting and financial accounts basic accounting terminology meaning and features of balance sheet income-expenditure account meaning, importance and specimen of journal objectives, functions, and importance of accounting stages and functions of accounting qualitative characteristics, objectives and roles of accounting

A bank can open a branch only at the permission of the _______.

  1. SBI

  2. RBI

  3. Government

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Ans :-

Banks have to apply to RBI for set-up of new branches. 
RBI has strict guidelines about the same keeping multiple factors in mind - type of bank, financial inclusion being done, location, density of banking needed etc

Multiple choice social science government and taxes types of tax types of taxes government budget and taxation

The practice of RBI lending to government through ad hoc treasury bills is _______.

  1. currently is vogue

  2. abolished

  3. will soon be abolished

  4. none of above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The practice of the RBI lending to the government through ad hoc treasury bills was abolished in 1997 to ensure greater fiscal discipline and central bank independence.

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply

CRR refers to the share of_____________ that rural banks have to maintain with RBI of their net demand and time liabilities?

  1. Liquid cash

  2. Gold

  3. Forex reserves

  4. Illiquid cash
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Cash Reserve Ratio (CRR) is the portion of deposits that banks must hold as liquid cash with the Reserve Bank of India. It is a tool used to control liquidity in the banking system.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

The full form for BIFR, in the context of the Indian Industry is _________.

  1. Board for Investment and Financial Redevelopment

  2. Bureau for Industrial and Financial Revolution

  3. Board for Investment and Formal Reconstruction

  4. Board for Industrial and Financial Reconstruction
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Board for Industrial and Financial Reconstruction (BIFR): BIFR was established under the Sick Industrial Companies (Special Pro-visions) Act 1985 (SICA). It is an agency of Government of India, part of the Department of Financial services of the Ministry of Finance. Its objective is to determine sickness of industrial companies and to assist in reviewing those that may be viable and shutting down the others.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Many a time we read about Special Drawing Right (SDR) in newspapers. As per its definition, SDR is a monetary unit of the reserve assets of which of the following organisations/agencies?

  1. World Bank

  2. International Monetary Fund (IMF)

  3. Asian Development Bank

  4. Reserve Bank of India
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Many a time we read about Special Drawing Right (SDR) in newspapers. As per its definition, SDR is a monetary unit of the reserve assets of International Monetary Fund(IMF). Special Drawing Right is a type of foreign-exchange reserve. It is introduced in 1969.

Multiple choice commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

Bank of India Account ___________.

  1. Real

  2. Personal

  3. Nominal

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Accounts recording transactions with a person or group of persons are known as personal accounts. These accounts are  necessary, in  particular, to record credit transactions. Personal accounts are of the following types:

1. Natural persons: An account recording transactions with an individual is termed as natural persons' personal account. For e.g., Kamal's account, Mala's account. Both male and females are included in it.
2. Artificial or legal persons: An account recording financial transaction with an artificial person created by law  or otherwise is termed as an artificial persons' personal account. For e.g., Firms' account, limited companies' account.
3. Representative personal account: An account indirectly representing a person or persons is known as representative personal account. When accounts are of similar nature and their number is large, it is better to group them under  one head and open a representative personal account. For e.g., prepaid rent, outstanding wages, etc.
  • Bank of India is a personal account as it is related to a banking firm which is an artificial persons. All those accounts which are related to a person, whether artificial or natural, are termed as personal account.

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

Indian financial system has provisions for the transfer of resources from the center to the states; the important means of resource transfer are _________________.

  1. devolution from the central taxes

  2. grant-in-aids for different purposes

  3. loans of short and long term periods

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The Indian financial system transfers resources to states through multiple channels, including tax devolution, grants-in-aid, and various loan facilities.

Multiple choice book keeping and accountancy accounting standards: concept and objectives accounting standards accounting standards (as) and ifrs accounting systems and reporting standards

The Main object of 'Rajiv Gandhi Equity Saving Scheme' (RGESS) is__________________.

  1. To encourage workers participation in management

  2. To encourage money market of India

  3. To encourage retail participation in capital market

  4. To encourage unlisted companies in Stock Exchanges
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The Rajiv Gandhi Equity Saving Scheme (RGESS) was introduced by the Indian government to encourage retail investors, particularly first-time investors, to participate in the capital markets.

Multiple choice book keeping and accountancy accounting standards: concept and objectives accounting standards accounting standards (as) and ifrs accounting systems and reporting standards

Which of the following statement is true?

  1. So far 28 Accounting standards have been issued in India

  2. Non-compliance of accounting standards is a criminal offence

  3. Accounting Standards are issued by CBDT

  4. Accounting Standard Board (ASB) was set up in 1977
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Recognizing the need to have a common platform for diversified accounting policies and practices in India and keeping in view the International development, the Institute of Chartered Accountants of India has set up a governing body i.e. Accounting Standard Board in 1977. 

Multiple choice commercial studies money loans from banks and financial institutions introduction to money - barter system owned fund and borrowed fund

In India, the Chit funds are governed / regulated by ___________.

  1. RBI

  2. Central Government

  3. State Governments

  4. Local Bodies
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Chit funds in India are governed by the Chit Funds Act, 1982. Under this Act, the chit fund business can be register and regulated only by the individual State Governments. Regulator of chit funds is the Registrar of Chits selected by the individual state government under Section 61 of Chit Funds Act. 

Powers of negotiation vest in the Registrar and the state government disturbed is the Appellate authority. In case of failure of a chit fund business, the task for windy up such a business also vests with the individual State Governments. 

Moreover, the Prize chits and money exchange schemes are illegal and are disqualified under the Prize Chits and Money movement Schemes (Banning) Act, 1978. Powers of investigation under this Act are vested with the disturbed state police authorities.

Thus, the correct option is C.

Multiple choice commercial studies money loans from banks and financial institutions introduction to money - barter system owned fund and borrowed fund

Paper notes and coins are accepted as a medium of exchange because they are _____.

  1. Light in weight

  2. Easy to carry

  3. Authorised by the government

  4. Issued by the Resrve Bank of India
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation
  • In Modern times paper notes and coins are used as medium of exchange.
  • Paper notes and coins are printed and circulated by RBI in India except One Rupee notes and coins.
  • One Rupee coins are printed by the Finance Ministry.
  • Only paper notes and coins printed by Government are authorised to use.
Multiple choice commercial studies money loans from banks and financial institutions introduction to money - barter system owned fund and borrowed fund

In a SHG, important decisions in regard to loan and savings are taken by _____.

  1. Government organization

  2. Bank

  3. Non-government organisation

  4. Group Members
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In a SHG (Self Help Group) important decisions in regard to loan and savings are taken by group members. Self Help Groups issue loans at reasonable rate of interest

Multiple choice commercial studies money loans from banks and financial institutions introduction to money - barter system owned fund and borrowed fund

The _____ supervises the functioning of formal sources of loans.

  1. State Bank of India

  2. Central Bank of India

  3. Reserve Bank of India

  4. Finance Minister
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The Reserve Bank of India supervises the functioning of formal sources of loans.
RBI is also the Central Bank of India.
RBI doesn't supervise the informal sources of credit institutions.