General Awareness Quiz for ECGC PO & Bank Mains Exams 2021- 10th January

Q1. Which among the following is correct about Bank Rate?
(a)It is the rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or other commercial papers.
(b)The Bank Rate is published under Section 49 of the Reserve Bank of India Act, 1934.
(c)This rate has been aligned to the MSF rate and, therefore, changes automatically as and when the MSF rate changes.
(d)All of the above is correct
(e)None of the above

Q2. The average daily balance that a bank is required to maintain with the Reserve Bank as a share of such per cent of its Net demand and time liabilities is known as ________.
(a)Bank Rate
(b)Repo rate
(c)Cash Reserve Ratio
(d)Statutory Liquidity Ratio
(e)None of the above

Q3. The interest rate at which the Reserve Bank absorbs liquidity, on an overnight basis, from banks against the collateral of eligible government securities under the LAF is known as _________.
(a)Bank Rate
(b)Repo rate
(c)Reverse Repo rate
(d)Marginal Standing Facility
(e)None of the above

Q4. The interest rate at which the Reserve Bank provides overnight liquidity to banks against the collateral under the liquidity adjustment facility (LAF) is known as _____.
(a)Bank Rate
(b)Repo rate
(c) Reverse Repo rate
(d)Market Stabilization Scheme
(e)None of the above

Q5. The Reserve Bank of India is vested with the responsibility of conducting monetary policy under_______.
(a)Reserve Bank of India Act, 1934
(b)Banking Regulation Act,1949
(c)Companies Act, 2013
(d)Negotiable Instruments Act, 1881
(e)None of the above

Q6. Which of the following is not a function of RBI:
(a)Issuer of currency
(b)Banker to the govt.
(c)Managing foreign exchange
(d)Managing monetary policy
(e)None of the above

Q7. Which of the following functions of RBI are related to Monetary Policy?
(a)Debt management
(b)to create and develop banking and financial institutions
(c)bridging the balance of payments deficit
(d)To control inflationary pressures
(e)All of the above

Q8. “Acting as lender of the last resort.” This feature of RBI belongs to which of the functional category of RBI?
(a)Banker to banks
(b)Developmental Role
(c) Monetary Authority
(d)Maintaining Financial Stability
(e)Regulator for the banking system

Q9. The Reserve Bank of India (RBI) has launched lavender coloured banknote for which of the following denominations?
(a)Rs 100
(b)Rs 500
(c)Rs 50
(d)Rs 10
(e)Rs. 20

Q10. Which of the following is not a function of RBI?
(a)Regulating and supervising the financial system
(b)Issuing currency
(c)Regulating and controlling the business on stock markets.
(d)Custodian of Country’s Foreign Currency Reserves
(e)Lender of Last Resort

Q11. Which bank is the banker to the Central Government?
(a)NABARD
(b)Reserve Bank of India
(c)Punjab National Bank
(d)State Bank of India
(e)All of these

Q12. India’s foreign exchange reserves, which are held and managed by RBI, comprise which of the following?
(a)Gold
(b)Foreign Currency Assets
(c)Special Drawing Rights (SDRs) allocated to India by the IMF
(d)Both 2 & 3
(e)All of the above

Q13. The main work of Reserve Bank of India is to regulate, control and decide:
(a)reserves for securing monetary stability in country
(b)orderly growth of insurance sector in the country
(c)foreign investments in Indian firms/businesses
(d)policies for banks and financial intuitions
(e)Wholesale and Retail price of consumables

Q14. RBI has the sole right to issue currency notes of various denominations except one-rupee notes. Under which of the following Acts is the RBI entitled to issue currency notes?
(a)Banking Regulation Act
(b)RBI Act
(c)Negotiable Instrument Act
(d)Indian Contract Act
(e)Companies Act

Q15. Reserve Bank of India is held responsible for the administration of Foreign Exchange Management Act. In which year did this act commence?
(a)1999
(b)1998
(c)1990
(d)1934
(e)1989

Solutions

S1.Ans.(d)
Sol. It is the rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or other commercial papers.

S2.Ans.(c)
Sol. The average daily balance that a bank is required to maintain with the Reserve Bank as a share of such per cent of its Net demand and time liabilities is known as CRR.

S3.Ans.(c)
Sol. The (fixed) interest rate at which the Reserve Bank absorbs liquidity, on an overnight basis, from banks against the collateral of eligible government securities under the LAF is Reverse Repo Rate.

S4.Ans.(b)
Sol. The (fixed) interest rate at which the Reserve Bank provides overnight liquidity to banks against the collateral of government and other approved securities under the liquidity adjustment facility (LAF) is Repo Rate.

S5.Ans.(a)
Sol. Monetary policy refers to the policy of the central bank with regard to the use of monetary instruments under its control to achieve the goals specified in the Act.

S6.Ans.(e)
Sol. All of the above are functions of RBI.

S7.Ans.(e)
Sol. All of the above are functions of Monetary Policy Committee.

S8.Ans.(a)
Sol. All banks maintain account with RBI to facilitate transfer of funds and settle inter-bank transactions.

S9.Ans.(a)
Sol. The Reserve Bank of India (RBI) has launched lavender-coloured Rs 100 note

S10.Ans.(c)
Sol. Regulating and controlling the business on stock markets is the major function of Securities and Exchange Board of India (SEBI)

S11.Ans.(b)
Sol. The RBI acts as banker to the government the Central as well as state governments.

S12.Ans.(e)
Sol. The Foreign exchange reserves of India consists of below four categories. (a) Foreign Currency Assets (b) Gold (c) SDRs (d) Reserve Tranche Position in the IMF

S13.Ans.(a)
Sol. Reserve bank of India is banker to banks and banker to government whose main work is to regulate issue of Bank Notes and keep reserves to safeguard monetary stability in the country

S14.Ans.(b)
Sol. Under Section 22 of the Reserve Bank of India Act, RBI has sole right to issue currency notes

S15.Ans.(a)
Sol. Foreign Exchange Management Act (FEMA) came into being in 1999.

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