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PYQ's (Money and Banking) - 20250428 - 141616 - 0000

The document contains questions and discussions related to money and banking, focusing on the Reserve Bank of India's monetary policy decisions and functions. It includes questions about the implications of interest rate changes, the role of money in transactions, and the central bank's responsibilities. Additionally, it poses hypothetical scenarios and numerical examples to illustrate concepts like credit creation and the management of government banking transactions.

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vedhimanshu9
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103 views2 pages

PYQ's (Money and Banking) - 20250428 - 141616 - 0000

The document contains questions and discussions related to money and banking, focusing on the Reserve Bank of India's monetary policy decisions and functions. It includes questions about the implications of interest rate changes, the role of money in transactions, and the central bank's responsibilities. Additionally, it poses hypothetical scenarios and numerical examples to illustrate concepts like credit creation and the management of government banking transactions.

Uploaded by

vedhimanshu9
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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PYQ's(Money and Banking)

2024(Set 1 and 2)
1. Read the following text carefully from "The Economic Times' dated 8th June, 2023:

"The Reserve Bank of India's (RBI's) rate setting panel unanimously decided to keep the
benchmark lending rate unchanged at 6.5%. The committee voted to remain focused on the
withdrawal of accommodating monetary policy."

On the basis of given text and common understanding, answer the following questions:

(a) Identify and discuss the economic issue indicated in the above text.(2)

(b) Discuss the likely consequence on money supply if the rate setting panel would have
decreased the said rate.(2)

Q.2: Justify the following statements with valid arguments :

(a) Money serves as the medium of exchange for transactional


purposes in an economy.(2)
(b) The Central Bank acts as a banker's bank in an economy.(2)

Q.3: The Reserve Bank of India undertakes the important function of managing the
government's banking transactions.
Discuss the above stated function performed by the Reserve Bank of
India.(4)

Q.4: Justify the following statements with valid arguments :


(a) The Central Bank is the sole currency issuing authority of an
economy.(2)
(b) Money serves as a measure of the standard of deferred payments. (2)

2023
Q.1: The rate at which commercial banks borrow from the Reserve Bank of India to meet their
long term requirements is known as:

(Choose the correct alternative to fill up the blank)

(a) Margin requirement


(b) Bank rate
(c) Repo rate
(d) Reverse repo rate

Q.2: Read the following news report carefully:

"The central bank has imposed fine on Hisar Urban Cooperative Bank Ltd. and Andaman and
Nicobar State Cooperative Bank Ltd. for violation of banking norms."

According to the given report, identify the function of the central bank.

(a) Issue of currency


(b) Banker to the public
(c) Banker to the Government
(d) Banker's Bank
Q.4: (a) Explain the 'Government's Bank' function of the central bank. (4)
OR
(b) Using a hypothetical numerical example, explain the effect of the rise in Reserve Ratio on
credit creation by the commercial banks. (4)

2020
Q.1: In order to control the money supply in the economy, the Central Bank may ________.
(Choose the correct alternative) 1
(A) buy securities in the open market
(B) sell securities in the open market
(C) reduce cash reserve ratio
(D) reduce repo rate

Q.2: Two components of the money supply are ________ and ________.
(Fill in the blanks with correct answers)

Q.3: Using a hypothetical numerical example, explain the process of credit creation by
commercial banks. (4)

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