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Home › Economy › Economy - Banking and Monetary Policy

Economy - Banking and Monetary Policy — Economy Questions & Practice

Practise 80 Economy - Banking and Monetary Policy questions from Economy for competitive exams such as UPSC, Banking, SSC and Railway. Read the worked questions below, check every answer with an explanation, and track what you get wrong.

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Practice questions on Economy - Banking and Monetary Policy — with answers

Try each question first, then open the answer. Explanations are included.

1. Which term is described as: 'India's central bank, responsible for regulating the monetary policy and banking system'?

  1. AScheduled Commercial Bank
  2. BBank Rate
  3. CReserve Bank of India (RBI)
  4. DCash Reserve Ratio (CRR)
Show answer

Answer: C

This corresponds to 'Reserve Bank of India (RBI)'.

2. Identify the term: 'India's central bank, responsible for regulating the monetary policy and banking system'.

  1. ABank Rate
  2. BPriority Sector Lending
  3. CReserve Bank of India (RBI)
  4. DNon-Banking Financial Company (NBFC)
Show answer

Answer: C

This corresponds to 'Reserve Bank of India (RBI)'.

3. Which of the following describes 'Repo Rate'?

  1. AA financial institution owned and operated by its members, providing banking services on a cooperative basis
  2. BThe interest rate at which the RBI lends money to commercial banks for short-term needs
  3. CThe percentage of a bank's total deposits that must be kept as reserves with the RBI
  4. DThe buying and selling of government securities by the central bank to regulate money supply
Show answer

Answer: B

'Repo Rate' relates to: The interest rate at which the RBI lends money to commercial banks for short-term needs

4. 'Repo Rate' refers to:

  1. AThe interest rate at which the RBI borrows money from commercial banks
  2. BA monetary policy tool used by central banks to increase money supply by purchasing financial assets
  3. CThe interest rate at which the RBI lends money to commercial banks for short-term needs
  4. DThe buying and selling of government securities by the central bank to regulate money supply
Show answer

Answer: C

'Repo Rate' relates to: The interest rate at which the RBI lends money to commercial banks for short-term needs

5. Which term is described as: 'The interest rate at which the RBI lends money to commercial banks for short-term needs'?

  1. ARepo Rate
  2. BBank Rate
  3. CMarginal Standing Facility (MSF)
  4. DFinancial Inclusion
Show answer

Answer: A

This corresponds to 'Repo Rate'.

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