Swapna, a small farmer, grows groundnut on her three acres of land. She takes a loan from the moneylender to meet the expenses of cultivation, hoping that her harvest would help repay the loan. Midway through the season the crop is hit by pests and the crop fails. Though Swapna sprays her crops with expensive pesticides, it makes little difference. She grows over the year into a large amount. Next year, Swapna takes a fresh loan for cultivation. It is a normal crop this year. But the earning are not enough to cover the old loan. She is caught in debt. She has to sell a part of the land to pay of the debt.
Answer the following MCQs by choosing the most appropriate option.
26.1. The passage given above relates to which of the following options?
(a) Collateral credit
(b) Credits recovery is very painful
(c) Failure of crops.
(d) Credit is somewhere beneficial.
26.2. According to the passage, Swapna faced which of the following options.
(a) Failure of the crop made loan repayment impossible.
(b) She had to sell part of the land to repay the loan
(c) Credit left her worse off
(d) All of the above
26.3. It refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment. It is called:-
(a) Term of credit
(b) Credit
(c) Depositor
(d) Borrower
26.4. The above passage is an example of
(a) Collateral loan
(b) Borrower's loan
(c) Debt-trap
(d) Informal loan trap
Answers
Answer:
Swapna, a small farmer, grows groundnut on her three acres of land. She takes a loan from the moneylender to meet the expenses of cultivation, hoping that her harvest would help repay the loan. Midway through the season the crop is hit by pests and the crop fails. Though Swapna sprays her crops with expensive pesticides, it makes little difference. She grows over the year into a large amount. Next year, Swapna takes a fresh loan for cultivation. It is a normal crop this year. But the earning are not enough to cover the old loan. She is caught in debt. She has to sell a part of the land to pay of the debt.
Answer the following MCQs by choosing the most appropriate option.
26.1. The passage given above relates to which of the following options?
(a) Collateral credit
(b) Credits recovery is very painful
(c) Failure of crops.
(d) Credit is somewhere beneficial.
26.2. According to the passage, Swapna faced which of the following options.
(a) Failure of the crop made loan repayment impossible.
(b) She had to sell part of the land to repay the loan
(c) Credit left her worse off
(d) All of the above
26.3. It refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment. It is called:-
(a) Term of credit
(b) Credit
(c) Depositor
(d) Borrower
26.4. The above passage is an example of
(a) Collateral loan
(b) Borrower's loan
(c) Debt-trap
(d) Informal loan trap