Practice Test

Q1) Money means anything that serves as - Show Answer

Q2) Measure of value of all goods and services refers __________ from following function of money. Show Answer

Q3) Which of the following functions are not performed by Money? Show Answer

Q4) Which is not the static function of money? Show Answer

Q5) Functions of money don't include: Show Answer

Q6) For an Indian Economist, Money represents Show Answer

Q7) Which of the following statements about Money is incorrect? Show Answer

Q8) For Modern Economist or Empiricists, the crucial function of Money is - Show Answer

Q9) For a Modern Economist, which of the following instruments serves to store value? Show Answer

Q10) According to the Empiricists, to include Financial Asset under the purview of Money, which of the following condition should be satisfied? Show Answer

Q11) According to some economists, Pure Money refers to Show Answer

Q12) According to some economists, Near Money refers to Show Answer

Q13) In a liberal sense, Money includes- Show Answer

Q14) Demand Deposits with Banks are considered as Money because they are- Show Answer

Q15) In Static Sense, Money serves as - Show Answer

Q16) In Dynamic Sense, Money serves the following purposes Show Answer

Q17) When we say that Money serves as a medium of exchange, we are considering the ___________ aspect of Money. Show Answer

Q18) When we say that Money serves as a common measure of value, we are considering the ___________ aspect of Money. Show Answer

Q19) When we say that Money serves as a standard for deferred payments, we are considering the ___________ aspect of Money. Show Answer

Q20) When Money serves as a store of value, we are considering the _________ aspect of Money. Show Answer

Q21) When we say that Money provides direction to economic trends, we are considering the ___________ aspect of Money. Show Answer

Q22) When we say that Money promotes occupational specialization and division of labour, we are considering the __________ aspect of Money. Show Answer

Q23) When we say that Money ensures conversion of savings into investment, we are considering the ____________ aspect of Money. Show Answer

Q24) Money serves as _____________ in any economy. Show Answer

Q25) Money serves as a unit of account. This means that - Show Answer

Q26) Money is a standard of deferred payments. This means that- Show Answer

Q27) Money acts as a store of value. This means that Show Answer

Q28) Money Supply is the stock of money held by - Show Answer

Q29) In order to increase money supply in the country, the RBI may: Show Answer

Q30) Which of the following is / a determinant(s) of money supply in an economy? Show Answer

Q31) The Quantity Theory of Money suggests that the demand for money is primarily influenced by: Show Answer

Q32) According to the Keynesian Theory of Money Demand, the main determinant of the demand for money is: Show Answer

Q33) The Baumol-Tobin model proposes that individuals hold money for the purpose of: Show Answer

Q34) The speculative demand for money is based on the expectation of changes in: Show Answer

Q35) The Fisher Effect suggests that an increase in the expected rate of inflation will lead to: Show Answer

Q36) The opportunity cost of holding money is often measured by the: Show Answer

Q37) The speculative demand for money is inversely related to changes in the: Show Answer

Q38) According to the Liquidity Preference Theory, the demand for money is influenced by: Show Answer

Q39) The Tobin's Portfolio Theory of Money Demand suggests that the demand for money is affected by changes in: Show Answer

Q40) The precautionary demand for money arises from the need to hold money for: Show Answer

Q41) What are monetary aggregates? Show Answer

Q42) M1 includes which of the following components? Show Answer

Q43) M2 includes which of the following components? Show Answer

Q44) M3 includes which of the following components? Show Answer

Q45) Which monetary aggregate is considered the narrowest measure of money supply? Show Answer

Q46) M4 includes which of the following components? Show Answer

Q47) Which monetary aggregate represents the broadest measure of money supply? Show Answer

Q48) The main purpose of creating different monetary aggregates is to: Show Answer

Q49) Non-Monetary Financial Institutions (NMFIs) are included in which monetary aggregate? Show Answer

Q50) Which of the following is an example of an M3 component? Show Answer

Q51) What is the money multiplier? Show Answer

Q52) The money multiplier approach helps explain the relationship between changes in the monetary base and changes in the: Show Answer

Q53) The money multiplier is influenced by which of the following factors? Show Answer

Q54) An increase in the required reserve ratio will lead to: Show Answer

Q55) The formula for calculating the money multiplier is: Show Answer

Q56) If the reserve ratio is 0.10 (10%), what is the money multiplier? Show Answer

Q57) The money multiplier approach assumes that banks will: Show Answer

Q58) If the central bank conducts an open market sale of government securities, the money supply will: Show Answer

Q59) In the money multiplier approach, the process of money creation continues until: Show Answer

Q60) The money multiplier approach assumes that there are no leakages or withdrawals from the banking system in the form of: Show Answer

Q61) What is monetary policy? Show Answer

Q62) The primary goal of monetary policy is to: Show Answer

Q63) The central bank can expand the money supply by: Show Answer

Q64) When the central bank buys government securities in the open market, it is conducting: Show Answer

Q65) Contractionary monetary policy is designed to: Show Answer

Q66) The interest rate at which the central bank lends money to commercial banks is known as the: Show Answer

Q67) Open market operations refer to the central bank's buying and selling of: Show Answer

Q68) An increase in the reserve requirement by the central bank will lead to: Show Answer

Q69) In a situation of economic recession, the central bank is likely to implement: Show Answer

Q70) The Taylor rule is a monetary policy guideline that links interest rates to: Show Answer

Q71) Quantitative easing (QE) is a monetary policy tool used by central banks to: Show Answer

Q72) The term "moral suasion" in the context of monetary policy refers to the central bank's ability to: Show Answer

Q73) The "liquidity trap" is a situation where: Show Answer

Q74) A central bank's target for inflation is often expressed through: Show Answer

Q75) The Phillips Curve illustrates the trade-off between: Show Answer

Q76) The term "forward guidance" in monetary policy refers to the central bank's communication about its future: Show Answer

Q77) An "inverted yield curve" is a situation where: Show Answer

Q78) The "dual mandate" of some central banks typically includes objectives related to: Show Answer

Q79) During periods of economic expansion, a central bank may pursue a policy of: Show Answer

Q80) "Sterilization" in the context of monetary policy refers to the central bank's actions to: Show Answer