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Question 1 of 5
1. Question
2 points
Consider the following statements about Monetary Policy Committee (MPC):
It consists of six members.
The Finance Secretary of the central government is the ex-officio chairperson of the MPC.
The term of members is for three years.
Members are not eligible for re-appointment.
Which of the statements given above are incorrect?
Correct
Answer: B Explanation:
Statement 1 is correct: MPC consists of six members.
Statement 2 is incorrect: RBI Governor is ex-officio chairperson of MPC.
Statement 3 is incorrect: The term of members is for four years
Statement 4 is correct: Members are not eligible for re-appointment
Incorrect
Answer: B Explanation:
Statement 1 is correct: MPC consists of six members.
Statement 2 is incorrect: RBI Governor is ex-officio chairperson of MPC.
Statement 3 is incorrect: The term of members is for four years
Statement 4 is correct: Members are not eligible for re-appointment
Question 2 of 5
2. Question
2 points
Consider the following statements about small savings schemes:
These schemes help in resource mobilization for the central government.
Funds collected under these schemes are accounted for in the Consolidated Fund of India.
Sukanya Samriddhi scheme is a small savings scheme.
Which of the statements given above is/are correct?
Correct
Answer: C
Explanation:
Statement 1 is correct: Small saving schemes (SSS) helps to support the social security objectives at the same time, helping as a tool of resource mobilization for the government.
Statement 2 is incorrect: Funds collected under SSS are the liabilities of the Union government accounted for in the Public Accounts of India and the government acts as a banker or trustee.
Statement 3 is correct: Small Savings Schemes can be grouped under three:
Post office Deposits: Post Office Savings Account, Post Office Time Deposits (1,2,3 and 5 years), Post Office Recurring Deposits, Post Office Monthly Account.
Savings Certificates: National Savings Certificate and Kisan Vikas Patra.
Social Security Schemes: Public Provident Fund, Senior Citizens Savings Scheme, and SukanyaSamriddhi Account.
Incorrect
Answer: C
Explanation:
Statement 1 is correct: Small saving schemes (SSS) helps to support the social security objectives at the same time, helping as a tool of resource mobilization for the government.
Statement 2 is incorrect: Funds collected under SSS are the liabilities of the Union government accounted for in the Public Accounts of India and the government acts as a banker or trustee.
Statement 3 is correct: Small Savings Schemes can be grouped under three:
Post office Deposits: Post Office Savings Account, Post Office Time Deposits (1,2,3 and 5 years), Post Office Recurring Deposits, Post Office Monthly Account.
Savings Certificates: National Savings Certificate and Kisan Vikas Patra.
Social Security Schemes: Public Provident Fund, Senior Citizens Savings Scheme, and SukanyaSamriddhi Account.
Question 3 of 5
3. Question
2 points
Consider the following statements –
India is a member of the ‘Basel Committee for Banking Supervision.
Under the Capital to Risk-Weighted Assets Ratio, Tier-1 capital can absorb losses without a bank being required to cease trading.
Under the Capital to Risk Weighted Assets Ratio, Tier-2 capital can absorb losses in the event of a winding-up and so provides a lesser degree of protection to depositors.
Which of the statements given above is/are correct?
Correct
Answer: C
Explanation:
Statement 1 is correct: The Basel Committee on Banking Supervision (BCBS) provides a forum for regular cooperation on banking supervisory matters. The Committee members come from 27 nations including India.
The capital-to-risk weighted assets ratio, also known as the capital adequacy ratio, is one of the most important financial ratios used by investors and analysts. The ratio measures a bank’s financial stability by measuring its available capital as a percentage of its risk-weighted credit exposure.
Statement 2 is correct: Under the Capital to Risk-Weighted Assets Ratio, Tier-1 capital can absorb losses without a bank being required to cease trading.
Statement 3 is correct: Under the Capital to Risk-Weighted Assets Ratio, Tier-2 capital can absorb losses in the event of a winding-up and so provides a lesser degree of protection to depositors.
Hence, option C is correct.
Incorrect
Answer: C
Explanation:
Statement 1 is correct: The Basel Committee on Banking Supervision (BCBS) provides a forum for regular cooperation on banking supervisory matters. The Committee members come from 27 nations including India.
The capital-to-risk weighted assets ratio, also known as the capital adequacy ratio, is one of the most important financial ratios used by investors and analysts. The ratio measures a bank’s financial stability by measuring its available capital as a percentage of its risk-weighted credit exposure.
Statement 2 is correct: Under the Capital to Risk-Weighted Assets Ratio, Tier-1 capital can absorb losses without a bank being required to cease trading.
Statement 3 is correct: Under the Capital to Risk-Weighted Assets Ratio, Tier-2 capital can absorb losses in the event of a winding-up and so provides a lesser degree of protection to depositors.
Hence, option C is correct.
Question 4 of 5
4. Question
2 points
Consider the following statements –
Soft currency is the international currency in which the highest faith is shown and is needed by every economy.
Hard currency is the currency that is easily available in any economy in its forex market.
Which of the statements given above is/are correct?
Correct
Answer: D
Explanation:
So, statement 1 is incorrect: Hard Currency is the international currency in which the highest faith is shown and is needed by every economy. The strongest currency in the world is one that has a high level of liquidity.
Statement 2 is incorrect: Soft Currency is a term used in the international exchange market which denotes the currency that is easily available in any economy in its forex market. For example, the rupee is a soft currency in the Indian forex market.
Hence, option D is correct.
Incorrect
Answer: D
Explanation:
So, statement 1 is incorrect: Hard Currency is the international currency in which the highest faith is shown and is needed by every economy. The strongest currency in the world is one that has a high level of liquidity.
Statement 2 is incorrect: Soft Currency is a term used in the international exchange market which denotes the currency that is easily available in any economy in its forex market. For example, the rupee is a soft currency in the Indian forex market.
Hence, option D is correct.
Question 5 of 5
5. Question
2 points
Which of the following are suitable measures to check inflation?
The government may go for import of goods which are in short supply.
Governments may cut down the excise and customs duties to cool down prices.
RBI may take up tighter monetary policy by increasing the Bank Rate and the Repo Rate.
Which of the statements given above is/are correct?
Correct
Answer: D
Explanation:
Statement 1 is correct: As a supply-side measure, the government may go for import of goods that are in short supply.
Statement 2 is correct: As a cost side measure, governments may cut down the excise and customs duties to cool down the price.
Statement 3 is correct: RBI may take up tighter monetary policy by increasing the Bank Rate and the Repo Rate.
Hence, option D is correct.
Incorrect
Answer: D
Explanation:
Statement 1 is correct: As a supply-side measure, the government may go for import of goods that are in short supply.
Statement 2 is correct: As a cost side measure, governments may cut down the excise and customs duties to cool down the price.
Statement 3 is correct: RBI may take up tighter monetary policy by increasing the Bank Rate and the Repo Rate.
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