Economy & Banking

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Q. What is the primary tool used by the RBI to control inflation?
  • A. Adjusting the Cash Reserve Ratio
  • B. Changing the Statutory Liquidity Ratio
  • C. Modifying the repo rate
  • D. Issuing new currency
Q. What is the purpose of Open Market Operations (OMO)?
  • A. To control the money supply in the economy
  • B. To regulate foreign exchange rates
  • C. To set interest rates for loans
  • D. To manage government expenditure
Q. What is the purpose of the Cash Reserve Ratio (CRR)?
  • A. To control inflation
  • B. To ensure liquidity in the economy
  • C. To regulate the money supply
  • D. To provide funds for government projects
Q. What is the purpose of the Liquidity Adjustment Facility (LAF) provided by the RBI?
  • A. To provide long-term loans to banks
  • B. To manage short-term liquidity mismatches
  • C. To control inflation directly
  • D. To regulate foreign investments
Q. What is the purpose of the Repo Rate?
  • A. To control inflation
  • B. To provide liquidity to banks
  • C. To regulate foreign exchange rates
  • D. To set the interest rates for savings accounts
Q. What is the relationship between inflation and interest rates?
  • A. Higher inflation typically leads to lower interest rates
  • B. Higher inflation typically leads to higher interest rates
  • C. Inflation has no effect on interest rates
  • D. Interest rates are always fixed regardless of inflation
Q. What is the role of automatic stabilizers in fiscal policy?
  • A. To increase taxes during a recession
  • B. To decrease government spending during a boom
  • C. To automatically adjust government spending and taxes
  • D. To eliminate budget deficits
Q. What is the role of the Integrated Child Development Services (ICDS) in food security?
  • A. Providing food grains to farmers
  • B. Ensuring nutritional support to children and mothers
  • C. Regulating food prices
  • D. Importing food for distribution
Q. What is the role of the RBI in managing the foreign exchange market?
  • A. Setting exchange rates
  • B. Controlling inflation
  • C. Regulating interest rates
  • D. Issuing foreign currency
Q. What is the role of the Reserve Bank of India (RBI) in agricultural financing?
  • A. Setting interest rates for agricultural loans
  • B. Directly providing loans to farmers
  • C. Regulating crop prices
  • D. Importing agricultural products
Q. What is the role of the Reserve Bank of India (RBI) in economic planning?
  • A. Regulating foreign exchange
  • B. Setting interest rates
  • C. Issuing currency
  • D. All of the above
Q. What is the role of the Reserve Bank of India (RBI) in fiscal management?
  • A. Setting fiscal policy
  • B. Managing government accounts
  • C. Regulating stock markets
  • D. Controlling inflation directly
Q. What is the role of the Reserve Bank of India (RBI) in fiscal policy?
  • A. Setting tax rates
  • B. Managing government debt
  • C. Regulating foreign exchange
  • D. Controlling inflation through interest rates
Q. What is the role of the Reserve Bank of India (RBI) in relation to unemployment?
  • A. Setting interest rates
  • B. Regulating stock markets
  • C. Managing foreign exchange
  • D. Controlling inflation
Q. What is the role of the Reserve Bank of India (RBI) in the banking structure?
  • A. To provide loans to individuals
  • B. To regulate and supervise the banking sector
  • C. To offer investment advice
  • D. To manage foreign exchange
Q. What is the significance of a contingency fund in disaster management?
  • A. To reduce government debt
  • B. To provide immediate financial resources for emergencies
  • C. To stabilize currency value
  • D. To fund long-term development projects
Q. What is the significance of capital budgeting?
  • A. It focuses on short-term financial planning
  • B. It assesses long-term investment projects
  • C. It determines tax policies
  • D. It manages daily operational costs
Q. What is the significance of crop insurance in agriculture?
  • A. To increase crop yield
  • B. To protect against crop loss
  • C. To reduce soil erosion
  • D. To enhance irrigation efficiency
Q. What is the significance of crop rotation in agriculture?
  • A. It increases water usage
  • B. It helps in pest control
  • C. It reduces soil fertility
  • D. It requires more irrigation
Q. What is the significance of the Marginal Standing Facility (MSF) in the RBI's monetary policy?
  • A. It allows banks to borrow overnight funds at a higher rate
  • B. It is used to control inflation directly
  • C. It provides long-term loans to the government
  • D. It regulates the foreign exchange market
Q. What is the significance of the National Food Security Mission (NFSM)?
  • A. To promote food exports
  • B. To enhance production of food grains
  • C. To reduce food prices
  • D. To provide loans to farmers
Q. What is the significance of the Planning Commission in India?
  • A. To formulate Five-Year Plans
  • B. To regulate banks
  • C. To control inflation
  • D. To manage foreign trade
Q. What is the significance of the Pradhan Mantri Jan Dhan Yojana in promoting inclusive growth?
  • A. It increases tax revenue
  • B. It provides direct cash transfers
  • C. It aims to provide banking access to all
  • D. It focuses on industrial development
Q. What is the significance of the SLR (Statutory Liquidity Ratio)?
  • A. It determines the minimum cash reserves for banks
  • B. It regulates the amount of gold banks must hold
  • C. It ensures banks maintain a certain percentage of liquid assets
  • D. It controls the interest rates on loans
Q. What is the term for the total amount of money a government owes to creditors?
  • A. Budget deficit
  • B. Public debt
  • C. Fiscal surplus
  • D. National savings
Q. What role do insurance products play in disaster management?
  • A. They increase financial risk
  • B. They provide financial protection against losses
  • C. They reduce the need for government intervention
  • D. They are not relevant in disaster scenarios
Q. What role does microfinance play in the context of inclusive growth in India?
  • A. It increases corporate investments
  • B. It provides loans to small businesses
  • C. It supports large-scale industries
  • D. It focuses on government funding
Q. What role does the Food Corporation of India (FCI) play in food security?
  • A. Regulating food prices
  • B. Storing and distributing food grains
  • C. Providing loans to farmers
  • D. Importing food grains
Q. What role does the RBI play in financing environmental initiatives?
  • A. Directly funding projects
  • B. Setting interest rates for green loans
  • C. Regulating environmental laws
  • D. Issuing environmental permits
Q. What role does the Reserve Bank of India (RBI) play in agricultural financing?
  • A. Directly providing loans to farmers
  • B. Regulating interest rates for agricultural loans
  • C. Setting crop prices
  • D. Controlling irrigation policies
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