Question

SECTION - A
CLASS: XII
Max. Marks: 50
Time: 2 Hr.
1 Which of the following system is followed by Reserve Bank Of India for issuing
currency?
(a) Minimum reserve system (b) Proportionate system
(b) Fixed fiduciary issue system (d) Simple deposit system
2
1
3
1
Which of the following measures of money supply are considered as monetary base ?
(a) M (b) M (C) M (d) M
Identify the incorrect statement from given below
(a) Present currency can work as money as it is a legal tender.
(b) Coins held by the public are limited legal tender
(c) Central bank prints currency in India
(d) Central bank do not deal with general public
Credit creation depends on
(a) initial level of deposit
(b) money multiplier
(c) Both (a) and (b)
(d) None of the above
Which of the following is not a consequences of deficit demand?
5

Answer 1

Answer:

1. a

The RBI follows the minimum reserve system, wherein it has to maintain a minimum quantity of gold bullion as reserves to issue currency. RBI follows minium reserve system .

2.

The money supply is the total amount of money—cash, coins, and balances in bank accounts—in circulation.

The money supply is commonly defined to be a group of safe assets that households and businesses can use to make payments or to hold as short-term investments. For example, U.S. currency and balances held in checking accounts and savings accounts are included in many measures of the money supply.

There are several standard measures of the money supply, including the monetary base, M1, and M2.

Answer 2

Answer:

SECTION - A

CLASS: XII

Max. Marks: 50

Time: 2 Hr.

1 Which of the following system is followed by Reserve Bank Of India for issuing

currency?

(a) Minimum reserve system (b) Proportionate system

(b) Fixed fiduciary issue system (d) Simple deposit system

2

1

3

1

Which of the following measures of money supply are considered as monetary base ?

(a) M (b) M (C) M (d) M

Identify the incorrect statement from given below

(a) Present currency can work as money as it is a legal tender.

(b) Coins held by the public are limited legal tender

(c) Central bank prints currency in India

(d) Central bank do not deal with general public

Credit creation depends on

(a) initial level of deposit

(b) money multiplier

(c) Both (a) and (b)

(d) None of the above

Which of the following is not a consequences of deficit demand?

5