MCQOPTIONS
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MCQOPTIONS
This section includes 99 Mcqs, each offering curated multiple-choice questions to sharpen your Bank Rates and Monetary Policy knowledge and support exam preparation. Choose a topic below to get started.
| 51. |
RBI has been amended by which act to provide for a Monetary Policy Committee for the maintenance of price stability? |
| A. | Finance Act 2016 |
| B. | Treasuries Act 2016 |
| C. | Financial Policy Act 2016 |
| D. | None of the above |
| Answer» B. Treasuries Act 2016 | |
| 52. |
How much will replacing INR 500 and 1000 rupee notes cost the RBI? |
| A. | INR 13000 crore |
| B. | INR 12000 crore |
| C. | INR 11000 crore |
| D. | INR 10000 crore |
| Answer» C. INR 11000 crore | |
| 53. |
The new high security INR 500 note has which of the following features? |
| A. | Bleed Lines |
| B. | Circle with 500 in the right |
| C. | Ashoka Pillar emblem |
| D. | All of the above |
| Answer» E. | |
| 54. |
RBI has relaxed prudential norms on what? |
| A. | Income recognition |
| B. | Asset classification |
| C. | Provisions pertaining to advances |
| D. | All of the above |
| Answer» E. | |
| 55. |
RBI kept repo rate unchanged at 6.25 percent. What did it abolish? |
| A. | Temporary 100 percent CRR |
| B. | 30 percent CRR |
| C. | 40 percent CRR |
| D. | None of the above |
| Answer» B. 30 percent CRR | |
| 56. |
RBI has opposed which move of the Watal Committee? |
| A. | Digital payments |
| B. | Separate entity to regulate payments and settlements |
| C. | Cashless transactions |
| D. | None of the above |
| Answer» C. Cashless transactions | |
| 57. |
RBI asked banks to maintain additional average daily balance through incremental CRR of what percent? |
| A. | 80 |
| B. | 90 |
| C. | 100 |
| D. | 110 |
| Answer» D. 110 | |
| 58. |
Who is RBI's youngest deputy governor? |
| A. | R. Gandhi |
| B. | Viral V Acharya |
| C. | Raghuram Rajan |
| D. | None of the above |
| Answer» C. Raghuram Rajan | |
| 59. |
What will be the impact on the Cash Reserves of commercial banks if RBI conduct a sale of securities? |
| A. | Increase |
| B. | Decrease |
| C. | Remain Constant |
| D. | None of These |
| Answer» C. Remain Constant | |
| 60. |
RBI, on behalf of government, issues MSS bonds to mop up extra liquidity from the market. This is same as Open Market Operations(OMO), but has a significant difference. What is it? |
| A. | Money raised from the market by MSS Bond is stored in government s normal account. |
| B. | Money raised from the market by MSS Bond is stored in a separate account, known as MSS Account, which cannot be used for normal government expenditure. |
| C. | Money is not raised by MSS bonds |
| D. | None of the above |
| Answer» C. Money is not raised by MSS bonds | |
| 61. |
What is/are the purpose(s) of Marginal Cost of Funds Lending Rate(MCLR) announced by RBI? (CSE, 2016) i) These guidelines help improve the transparency in the methodology followed by banks for determining the interest rates on advances. ii) These guidelines help ensure availability of bank credit at interest rates which are fair to the borrowers as well as banks. Select the correct answer using the code given below: |
| A. | 1 only |
| B. | 2 only |
| C. | Both 1 and 2 |
| D. | Neither 1 nor 2 |
| Answer» B. 2 only | |
| 62. |
Under which qualitative tool, RBI fixes maximum limit to loan and advances that can be made, above which the commercial banks cannot exceed? |
| A. | Rationing of credit |
| B. | Margin requirement |
| C. | Loan-Value ratio |
| D. | Moral Suasion |
| Answer» B. Margin requirement | |
| 63. |
With reference to Indian economy, consider the following: 1. Bank rate 2. Open Market Operations 3. Public debt 4. Public revenue Which of the above is/are component(s) of Monetary Policy? |
| A. | 1 only |
| B. | 2,3 and 4 |
| C. | 1 and 2 |
| D. | 1, 3 and 4 |
| Answer» D. 1, 3 and 4 | |
| 64. |
When RBI reduces Statutory Liquidity Ratio by 50 basis points , which of the following is likely to happen? |
| A. | India s GDP growth rate increases drastically. |
| B. | Foreign Institutional Investors may bring more capital in to our country. |
| C. | Scheduled Commercial Banks may cut their lending rates. |
| D. | It may drastically reduce the liquidity to the banking system. |
| Answer» D. It may drastically reduce the liquidity to the banking system. | |
| 65. |
The terms Marginal Standing Facility Rate and Net Demand and Time Liabilities , sometimes appearing in news, are used in relation to? |
| A. | Banking Operations |
| B. | Communication Networking |
| C. | Military Strategies |
| D. | |
| Answer» B. Communication Networking | |
| 66. |
In context of Indian economy , Open Market Operations refers to? |
| A. | Borrowing by Scheduled banks from RBI. |
| B. | Lending by commercial banks to industry and trade. |
| C. | Purchase and sale of govt securities by the RBI. |
| D. | None of the above. |
| Answer» D. None of the above. | |
| 67. |
Which among the following is not a part of Liquidity Adjustment Facility (LAF)? |
| A. | Repo Rate |
| B. | Reverse Repo Rate |
| C. | Marginal Standing Facility (MSF) |
| D. | Open Market Operations (OMO) |
| Answer» E. | |
| 68. |
Which among the following is also known as base money or high-powered money or Reserve Money? |
| A. | M0 |
| B. | M1 |
| C. | M2 |
| D. | M3 |
| Answer» B. M1 | |
| 69. |
Which among the following defines Bank Rate? |
| A. | The rate at which banks place their surplus funds with the RBI |
| B. | The rate at which banks can borrow against their excess SLR securities to meet additional liquidity requirements |
| C. | The rate at which the Reserve Bank is prepared to buy or re-discount bills of exchange or other commercial paper eligible for purchase |
| D. | The rate at which banks borrow funds from the Reserve Bank against eligible collaterals |
| Answer» D. The rate at which banks borrow funds from the Reserve Bank against eligible collaterals | |
| 70. |
Which among the following defines Marginal Standing Facility Rate? |
| A. | The rate at which banks place their surplus funds with the RBI |
| B. | The rate at which banks can borrow against their excess SLR securities to meet additional liquidity requirements |
| C. | The rate at which the Reserve Bank is prepared to buy or re-discount bills of exchange or other commercial paper eligible for purchase |
| D. | The rate at which banks borrow funds from the Reserve Bank against eligible collaterals |
| Answer» C. The rate at which the Reserve Bank is prepared to buy or re-discount bills of exchange or other commercial paper eligible for purchase | |
| 71. |
Which among the following defines Reverse Repo Rate? |
| A. | The rate at which banks place their surplus funds with the RBI |
| B. | The rate at which banks can borrow against their excess SLR securities to meet additional liquidity requirements |
| C. | The rate at which the Reserve Bank is prepared to buy or re-discount bills of exchange or other commercial paper eligible for purchase |
| D. | The rate at which banks borrow funds from the Reserve Bank against eligible collaterals |
| Answer» B. The rate at which banks can borrow against their excess SLR securities to meet additional liquidity requirements | |
| 72. |
Which among the following defines Repo Rate? |
| A. | The rate at which banks place their surplus funds with the RBI |
| B. | The rate at which banks can borrow against their excess SLR securities to meet additional liquidity requirements |
| C. | The rate at which the Reserve Bank is prepared to buy or re-discount bills of exchange or other commercial paper eligible for purchase |
| D. | The rate at which banks borrow funds from the Reserve Bank against eligible collaterals |
| Answer» E. | |
| 73. |
Which out of the following is/are correct regarding Statutory Liquidity Ratio (SLR)? a) Section 42 of RBI Act, 1934 lays foundation for maintaining SLR by scheduled commercial bank with RBI. b) Section 24 of the Banking Regulations Act, 1949 provide powers to RBI to specify SLR on banks c) At present SLR is 19.50 per cent of NDTL d) Qualified liquid assets for purpose of SLR are: unencumbered government and other approved securities, gold, cash and excess CRR balance Select the correct answer from following options: |
| A. | Only a, b and c |
| B. | Only b, c and d |
| C. | Only a, c and d |
| D. | All are correct |
| Answer» C. Only a, c and d | |
| 74. |
Which out of the following is/are correct regarding Cash Reserve Ratio (CRR)? a) Section 42 of RBI Act, 1934 lays foundation for maintaining CRR by scheduled commercial bank with RBI. b) Section 24 of the Banking Regulations Act, 1949 provide powers to RBI to levy CRR on banks c) At present CRR is 4 per cent of NDTL d) Banks have to maintain minimum 95 per cent of the required CRR on a daily basis and 100 per cent on an average basis during the fortnight Select the correct answer from following options: |
| A. | Only a, b and c |
| B. | Only b, c and d |
| C. | Only a, c and d |
| D. | All are correct |
| Answer» D. All are correct | |
| 75. |
Which out of the following is/are included in second schedule of Reserve Bank of India a) Nationalised Banks. b) Regional Rural Banks c) State co-operative banks d) Village level Primary Co-operative Societies Select the correct answer from following options: |
| A. | Only a, b and c |
| B. | Only b, c and d |
| C. | Only a, d and c |
| D. | All are correct |
| Answer» B. Only b, c and d | |
| 76. |
Reverse Repo Rate is a tool used by RBI to? |
| A. | Absorb liquidity |
| B. | Inject liquidity |
| C. | To keep liquidity at one level |
| D. | None of these |
| Answer» B. Inject liquidity | |
| 77. |
An increase in Bank Rate generally indicates that the market rate of interest is likely to fall. |
| A. | Market rate of interest is likely to fall. |
| B. | Central bank is no longer making loans to commercial banks. |
| C. | Central bank is following an easy money policy. |
| D. | Central bank is following a tight money policy. |
| Answer» E. | |
| 78. |
The Reserve Bank of India will transfer its surplus profit of 65,896 crore rupees to the Centre. This amount is ___ percent higher than previous year. |
| A. | 5% |
| B. | 19% |
| C. | 25% |
| D. | 33% |
| Answer» D. 33% | |
| 79. |
Federal Reserve Board of Governors members serve __________ terms to help insulate them from political influence. |
| A. | 14 years |
| B. | 7 years |
| C. | Lifetime |
| D. | 25 years |
| Answer» B. 7 years | |
| 80. |
Through open market operations, the Federal Reserve buys and sells government securities to influence the supply of bank reserves. When the Fed wants to increase reserves, it does what? |
| A. | Buys Securities |
| B. | Sells Securities |
| C. | Nothing |
| Answer» B. Sells Securities | |
| 81. |
Monetary policy refers to what the Federal Reserve does to influence the amount of __________ and __________ in the U.S. economy. |
| A. | Currency and gold reserves |
| B. | Money and credit |
| C. | Taxes and revenue |
| D. | Interest and debt |
| Answer» C. Taxes and revenue | |
| 82. |
RBI has launched a portal to curb illegal money pooling by firms called ___________. |
| A. | Sanchet.rbi.org.in |
| B. | Sachet.rbi.org.in |
| C. | Sanket.rbi.org.in |
| D. | None of the above |
| Answer» B. Sachet.rbi.org.in | |
| 83. |
Federal Reserve Board of Governors members are appointed by the ____________ and confirmed by the ______________. |
| A. | |
| B. | B. |
| C. | C. |
| D. | D. |
| E. | |
| Answer» B. B. | |
| 84. |
Inflation is a sustained increase in the general level of __________. |
| A. | Accounts |
| B. | Income |
| C. | Prices |
| D. | Profit |
| Answer» D. Profit | |
| 85. |
Which of these is NOT a monetary policy tool? |
| A. | Discount Rate |
| B. | Open Market Operations |
| C. | Balance Accounts |
| D. | Reserve Requirements |
| Answer» D. Reserve Requirements | |
| 86. |
The goals of monetary policy do NOT include the promotion of _________________ |
| A. | Maximum employment |
| B. | Low Taxes |
| C. | Stable Prices |
| D. | Moderate long-term interest rates |
| Answer» C. Stable Prices | |
| 87. |
In which year Liquidity Adjustment Facility (LAF) was introduced by Reserve Bank of India? |
| A. | 1998 |
| B. | 2000 |
| C. | 2002 |
| D. | 2004 |
| Answer» C. 2002 | |
| 88. |
EBI has come out with a PCA for banks. What does PCA stand for? |
| A. | Performance corrective action |
| B. | Prompt corrective action |
| C. | Personnel corrective action |
| D. | None of the above |
| Answer» C. Personnel corrective action | |
| 89. |
Which office has seen the appointment of an RBI ombudsman? |
| A. | Jammu |
| B. | Delhi |
| C. | Both of the above |
| D. | Punjab |
| Answer» D. Punjab | |
| 90. |
RBI has asked ARCs to have minimum NOF of ____ crore. |
| A. | 25 |
| B. | 50 |
| C. | 70 |
| D. | none of the above |
| Answer» E. | |
| 91. |
According to RBI, India s forex reserves rose to which record high? |
| A. | USD 372.73 billion |
| B. | USD 373.73 billion |
| C. | USD 374.73 billion |
| D. | USD 375.73 billion |
| Answer» B. USD 373.73 billion | |
| 92. |
RBI has tightened the rules around JLFs. What does JLF stand for? |
| A. | Joint Lenders Forum |
| B. | Joint Liability Forum |
| C. | Joint Liaison Forum |
| D. | None of the above |
| Answer» B. Joint Liability Forum | |
| 93. |
RBI kept repo rates ____ in second bi-monthly monetary policy review. |
| A. | Higher |
| B. | |
| C. | C. |
| D. | D. |
| Answer» D. D. | |
| 94. |
RBI has expanded the definition of which scheme? |
| A. | Banking ombudsman scheme |
| B. | Banking internal stakeholders scheme |
| C. | Personalised banking scheme |
| D. | None of the above |
| Answer» B. Banking internal stakeholders scheme | |
| 95. |
RBI has relaxed norms for which of the following bonds? |
| A. | Masala bonds |
| B. | Rupee denominated overseas bonds |
| C. | Green bonds |
| D. | Both a and b |
| Answer» E. | |
| 96. |
RBI has constituted an Internal Advisory Committee for resolution under which code? |
| A. | Bankruptcy Code 2016 |
| B. | Insolvency Code 2016 |
| C. | Bankruptcy and Insolvency Code 2016 |
| D. | Insolvency and Bankruptcy Code 2016 |
| Answer» E. | |
| 97. |
RBI cut repo rate to ___ on Aug 2, 2017. |
| A. | 5.5 percent |
| B. | 5.75 percent |
| C. | 6 percent |
| D. | 6.5 percent |
| Answer» D. 6.5 percent | |
| 98. |
Who is the 8th deputy governor to become governor at RBI? |
| A. | Raghuram Rajan |
| B. | Urjit Patel |
| C. | R. Gandhi |
| D. | None of the above |
| Answer» C. R. Gandhi | |
| 99. |
RBI has released the on tap universal banking license excluding which group as eligible entities from the purview? |
| A. | Small industrial houses |
| B. | Medium industrial houses |
| C. | Large industrial houses |
| D. | None of the above |
| Answer» D. None of the above | |