List of top Economics Questions on Money and Banking

Arrange the following components of monetary aggregates in descending order as per their liquidity: 

(A) currency notes 
(B) demand deposits 
(C) time deposits 
(D) money market mutual fund 
Choose the correct answer from the options given below: 
 

In the Keynesian framework, determination of an equilibrium interest rate also implies 

(A) The rate that equates the supply of and the demand for bonds. 
(B) The rate that equates the supply of money with the demand for money. 
(C) The rate that equates the supply of money and demand for investment. 
(D) The rate that equates supply of labour and demand for labour. 
Choose the correct answer from the options given below:
 

Match List-I with List-II \[\begin{array}{|c|c|} \hline \textbf{Measures of Money Supply} & \textbf{Components} \\ \hline \text{(A) M3} & \text{(I) Currency held by the public (C) + net demand deposits of banks (DD) + other deposits of the RBI (OD)} \\ \hline \text{(B) M2} & \text{(II) C + DD + OD + net time deposits of banks} \\ \hline \text{(C) M1} & \text{(III) C + DD + OD + saving deposits with post office saving banks} \\ \hline \text{(D) M4} & \text{(IV) C + DD + OD + net time deposits of banks + total deposits with post office savings organization (excluding National Saving Certificates)} \\ \hline \end{array}\] Choose the correct answer from the options given below:
Which of the following statements are correct about the money multiplier? (A) It is the ratio of the stock of money to the stock of high powered money.
(B) It is always smaller than one.
(C) Its value depends on the reserve ratio and currency-deposit ratio.
(D) It is inversely related to the reserve ratio.
Choose the correct answer from the options given below:
The statement that "currency held in the hand yields no income" is given by:
Commercial banks in India are subject to a statutory liquidity requirement (SLR). Which of the following is not part of the SLR?
Which of the following does not constitute liabilities of commercial banks in India?
Justify the following statements with valid arguments:
(i) Money supply in an economy is an example of a stock variable.
(ii) The Central Bank provides several Banking services to the government.
Define central bank and explain its functions.
What are the main functions of money?
State two sources of supply of foreign exchange.
Mention two contingent functions of money.
What do you mean by Demand deposits?
What is Statutory Liquidity Ratio (SLR)?
Foreign exchange rate is determined by
Who determines the foreign exchange rate?
Where is the headquarters of RBI?
For controlling inflation, bank rate is
Which of the following monetary measures may be adopted to correct deficient demand?
Which of the following is included in the qualitative method of controlling credit?
Which of the following statements is true?
Which of the following is the secondary function of commercial banks?
Commercial banks create credit by
Commercial banks
Central bank controls credit through