INSIGHT UPSC QUIZ

Consider the following statements about the ‘Cash Reserve Ratio (CRR)’: 

1. It is the percentage of deposits which every bank must keep as cash reserves with the central bank. 

2. Banks cannot lend the CRR money to corporates or individual borrowers but they can use that money for investment purposes. 

3. Banks earn interest on the CRR money kept with the central bank. 

Which of the statements given above is/are correct?

Which of the following is generally the largest source for financing the ‘fiscal deficit’ of the Union government? 

Which among the following are the merits of ‘flexible exchange rate system’ over ‘fixed exchange rate system’?

1. The government does not need to maintain large stock of foreign exchange reserves.

2. Movements in the exchange rate are managed by the central banks by buying and selling foreign currencies.

3. The countries gain autonomy in conducting their monetary policies.

Select the correct answer using the code given below.

Consider the following statements: 

1. It issues currency of the country. 

2. It controls money supply of the country.

3. It acts as a banker to the government. 

4. It acts as a bank to the banking system.

5. It is the lender of last resort.

Which of the statements given above correctly define the functions of ‘Reserve Bank of India’? 

Which of the following conditions can increase the acceptability of a national currency to be used as an international medium of exchange?

1. The amount of goods that can be bought with a certain amount of that currency does not change frequently. 

2. The national currency is freely convertible at a fixed price into another asset like gold.

3. The issuing authority has full control over the value of that asset into which the currency can be converted.

Select the correct answer using the code given below.

Which among the following are the effects of Globalisation?

Consider the following statements with reference to ‘Balance of Trade (BOT)’: 

1. Difference between value of exports and value of imports of goods of a country in a given period of time.

2. Difference between the value of exports and value of imports of services of a country in a given period of time.

3. Difference between the value of exports and value of imports of services and assets of a country in a given period of time.

4. Difference between the value of capital account and the value of current account of a country in a given period of time.

Which of the statements given above correctly defines the term ‘Balance of Trade (BOT)’?

In context of the difference between ‘devaluation and depreciation’, consider the following statements:

1. Devaluation is the deliberate downward adjustment of a country's currency value, whereas depreciation is a fall in the value of a currency.

2. Devaluation is more relevant in a fixed or semi-fixed exchange rate, whereas depreciation is more relevant in a floating exchange rate.

3. Devaluation makes imports more expensive, and exports more competitive, whereas depreciation makes imports cheaper, and exports less competitive.

Which of the statements given above are correct?

Consider the following statements:

1. Reserve Bank of India allowed stock exchanges to start the T+1 Settlement system for completion of share transactions.

2. T+1 settlement system will help in reducing the number of outstanding unsettled trades at any instant.

3. A shortened cycle not only reduces settlement time but also frees up the capital required to collateralize that risk. 

Which of the statement(s) given above is/are correct?

Consider the following statements:

1. The demand for every good in the market has a direct relationship with increase or decrease in its price.

2. Price elasticity is a measure of the change in demand of product/service in response to changes in income of consumers.

Which of the statement(s) given above is/are correct?