Available Answers

1. 1.

   MULTIPLE CHOICE QUESTIONS.

   1. RBI is ________________.
      1. Commercial Bank
      2. Central Bank
      3. Specialised Bank
      4. None of these
   2. Which of the following is a Commercial Bank?
      1. SBI
      2. RBI
      3. EXIM
      4. None of these
   3. A bank is an institution which accepts ________________ from the public and advances ________________.
      1. Deposits, loans
      2. Loans, deposits
      3. Cash, cash
      4. Loan, loan
   4. The ________________ of a country serves as the leader of the banking system and the money market.
      1. Commercial Bank
      2. Central Bank
      3. Specialised Bank
      4. None of these
   5. It acts as the bankers' bank.
      1. Commercial Bank
      2. Central Bank
      3. Specialised Bank
      4. None of these
   6. It carries out the country's monetary policy.
      1. Commercial Bank
      2. Central Bank
      3. Specialised Bank
      4. None of these
   7. ________________ is the apex institution of the country's monetary and banking structure where as ________________ is one of the organs of the money market.
      1. Commercial Bank, central bank
      2. Central Bank, commercial bank
      3. Specialised Bank, central bank
      4. Commercial bank, specialised bank
   8. Central bank is owned by the ________________ while commercial bank is owned by ________________.
      1. Shareholders, shareholders
      2. Government, shareholders
      3. Shareholders, government
      4. None of these
   9. Central bank is the ________________ of the country's foreign currency reserves.
      1. Dealer
      2. Consumer
      3. Custodian
      4. User
   10. Which of the following is/are the function(s) of central bank?
       1. Banker's bank
       2. Lender of the last resort
       3. Receive deposits from the public and business firms
       4. Provide short-term and medium-term loans to customers
   11. It means signing on the back of the negotiable instrument with the objective of transferring its ownership.
       1. Endorsement
       2. Pay-in slip
       3. Crossing a cheque
       4. Bank draft
   12. It means restricting its circulation by writing something on it.
       1. Endorsement
       2. Pay-in slip
       3. Crossing a cheque
       4. Bank draft
   13. It is a banker's cheque.
       1. Endorsement
       2. Pay-in slip
       3. Crossing a cheque
       4. Bank draft
   14. ________________ is a book issued by a bank to an account holder.
       1. Pass book
       2. Pay-in slip
       3. Crossing a cheque
       4. Bank draft
   15. ________________ book contains blank forms for depositing cash or cheques in a bank.
       1. Pass book
       2. Pay-in slip
       3. Crossing a cheque
       4. Bank draft
   16. A cheque can be
       1. Bearer
       2. Order
       3. Crossed
       4. All of these
   17. Commercial banks accept deposits, lend money and provide other services.
       1. True
       2. False
   18. A central bank acts as a banker's bank, bank to government, and regulator of credit.
       1. True
       2. False
   19. Central bank regulates credit through
       1. Open market operations
       2. Bank rate
       3. Reserve requirements
       4. All of these
   20. ________________ are the main types of bank accounts.
       1. Current
       2. Recurring
       3. Fixed deposit accounts
       4. All of these
   21. ________________ are of several types, e.g., commercial, central, industrial, merchant, exchange, agricultural, cooperative, postal and indigenous.
       1. Shops
       2. Market
       3. Banks
       4. None of these
   22. A ________________ is one which is not payable across the counter of the bank. It can be collected only through a bank.
       1. Open cheque
       2. Pay-in slip
       3. Crossed cheque
       4. Bank draft
   23. An ________________ is a cheque which is payable across the counter of the bank.
       1. Open cheque
       2. Pay-in slip
       3. Crossed cheque
       4. Bank draft
   24. In this account, the account holder is required to deposit a specific amount every month. After the expiry of the specified period, the depositor gets back his money together with interest thereon.
       1. Current account
       2. Recurring deposit account
       3. Saving account
       4. None of these
   25. A fixed deposit is also known as
       1. Time deposit
       2. Long-term deposit
       3. Both (A) and (B)
       4. None of these
   26. ________________ is a Banker's Bank.
       1. Commercial Bank
       2. Agricultural Bank
       3. Exchange Bank
       4. Central Bank
   27. In this type of account, no cheque book is issued to the account holder:
       1. Fixed Deposit account
       2. Open account
       3. Saving Deposit account
       4. Current account
   28. A bank is a ________________ which collects money from the public in the form of deposits and lends the same to the borrowers.
       1. company
       2. Reserve bank
       3. government organisation
       4. Lender of the last resort
   29. ATM means:
       1. Any Time Money
       2. Amount Transaction Message
       3. Auto Transfer Money
       4. Automated Teller Machine
   30. The ________________ is an extract or copy of the customer's account in the bank's ledger as on a particular date.
       1. Passbook
       2. Pay-in-slip book
       3. Cheque book
       4. Withdrawal form
2. 2.

   A demand draft is preferable to a cheque. Justify either for or against.
3. 3.

   Explain in brief moral suasion as a tool of credit control.
4. 4.

   Explain industrial banks.
5. 5.

   "A central bank is a banker's bank." Explain.
6. 6.

   What are the two main functions of a commercial bank?