3/6/25, 12:13 PM Mrunal's Weekly MockTest Pillar_1A2_Monetary_Policy | Unacademy

Plus Test series Mrunal’s Economy for UPSC Prelims-2025 (PCB1… Mrunal's Weekly MockTest Pillar_1A2_Monetary_…

Solutions

All answers

Question 1
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If you withdraw Rs. 1 lakh in cash from your Demand Deposit Account at your bank, the
immediate effect on aggregate money supply in the economy will be _ _ . (यदि आप अपने बैंक
के माँग जमा खाते से ₹1,00,000 की नकद राशि निकालते हैं, तो अर्थव्यवस्था में तात्कालिक रूप से मुद्रा की
समग्र पूर्ति पर इसका क्या प्रभाव पड़ेगा ?)(UPSC-Prelims-2020)

to reduce it by ₹ 1,00,000 (मुद्रा की to increase it by ₹ 1,00,000 (मुद्रा की

समग्र पूर्ति में ₹1,00,000 की कमी आएगी) समग्र पूर्ति में ₹1,00,000 की वृद्धि होगी)

to increase it by more than ₹ to leave it unchanged (मुद्रा की समग्र

1,00,000 (मुद्रा की समग्र पूर्ति में ₹ पूर्ति अपरिवर्तित रहेगी)
1,00,000 से अधिक की वृद्धि होगी)

Solution Hide
Correct Answer: D
Demand deposit account consists of funds held in a bank account from which deposited
funds can be withdrawn at any time.
Option (d) is correct: The money supply is the total value of money available in an economy
at a point of time. Money supply consists of total currency circulating in the public plus the
demand deposits of the public with banks.
Money Supply = Money with public + money held in the bank
So, when we withdraw cash from the bank, it goes into the hands of the public. Any such
withdrawal does not change the aggregate money supply in the economy.

Question 2
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Money Multiplier in an economy increases with _ _ _? (किसी अर्थव्यवस्था में मुद्रा गुणक (मनी
मल्टिप्लायर) निम्नलिखित में से किस एक के साथ-साथ बढ़ता है?) (UPSC-Prelims-2019)

Increase in the banking habit of the

Increase in the cash reserve ratio
population (जनता की बैंकिं ग आदतों में
(आरक्षित नकदी (कै श रिज़र्व) अनुपात में
वृद्धि)
वृद्धि)

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Increase in the statutory liquidity Increase in the population of the

ratio (सांविधिक नकदी अनुपात में वृद्धि) country (देश की जनसंख्या में वृद्धि)

Solution Hide
Correct Answer: B
Money multiplier is the amount of broad money that banks generate with each rupee of
reserves or base money available with them. Here, reserves are the amount of deposits that
the RBI requires banks to hold and not to lend.
Option (b) is correct: Money multiplier depicts the relationship between the monetary base
and the economy's money supply and it tells how fast the money supply from the bank
lending will grow. Money Multiplier in an economy increases with the increase in banking
habits of the population.
Increase in Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) decreases money
multiplier in an economy. With the increase in CRR and SLR banks have to keep more money
in reserve with the RBI and with themselves which results in less credit creation and thus
decrease in money multiplier.
Increase in population does not have any direct correlation with the increase or decrease in
money multiplier in an economy.

Question 3
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Cash Reserve Ratio refers to _ _ _ .(नकद आरक्षित अनुपात निम्नलिखित में से किसको संदर्भित करता
है?) (UPSC-CDS-i-2020)

the share of Net Demand and time the share of NDTL that banks have
liabilities (NDTL) that banks have to to hold as balances with the RBI
hold as liquid assets (नेट डिमांड एं ड (NDTL का वह हिस्सा जो बैंकों को
टाइम लायबिलिटीज (NDTL) का वह हिस्सा आरबीआई के पास शेष राशि के रूप में
जो बैंकों को तरल संपत्ति के रूप में रखना रखना होता है)
होता है)

the share of Net demand and time

liabilities that banks have to hold as
the ratio of cash holding to reserves
part of their cash reserves (नेट डिमांड
of banks (बैंकों के भंडार में नकदी रखने का
और टाइम लायबिलिटी का हिस्सा जो बैंकों को
अनुपात)
अपने कै श रिजर्व के हिस्से के रूप में रखना
होता है)

Solution Hide
Option (b) is correct: Cash Reserve Ratio (CRR) is defined under section 42(1) of the Reserve
Bank of India (RBI) Act, 1934. It is the average daily balance that a scheduled commercial
bank is required to maintain with the RBI as a share of such per cent of its Net Demand and
Time Liabilities (NDTL). CRR is maintained in cash form only.

Question 4
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Find correct statements about SLR: (सांविधिक तरलता अनुपात के बारे में सही कथन को खोजिये)
(UPSC-CDS-2011-II)
1. To meet SLR, Commercial banks must keep cash only. (SLR पूर्ती हेतु, वाणिज्यिक बैंकों को
के वल नकद ही रखना चाहिए।)
2. SLR is maintained by the banks themselves. (SLR स्वयं बैंकों द्वारा बनाए रखा जाता है)
3. SLR restricts the banks leverage in pumping more money into the economy. (SLR
अर्थव्यवस्था में अधिक पैसा पंप करने में बैंकों के उत्तोलन को प्रतिबंधित करता है)
Answer Codes: (उत्तर हेतु कू ट:)

1, 2 and 3 (1, 2 और 3) 1 and 3 Only (के वल 1 और 3)

2 and 3 Only (के वल 2 और 3)

2 only (के वल 2)

Solution Hide
Correct Answer: C
Statement 1 is not correct: Statutory Liquidity Ratio (SLR) is maintained in safe and liquid
assets such as unencumbered Government Securities (assets that are free and clear of any
encumbrances such as creditor claims or liens), cash and gold.

Statement 2 is correct: Statutory Liquidity Ratio (SLR) is defined under Section 24 of the
Banking Regulation Act, 1949. It is the amount of money that a scheduled commercial bank
has to keep within itself on a daily basis as a percentage share of its NDTL.

Statement 3 is correct: Statutory Liquidity Ratio (SLR) is one of the reserve requirements
which restricts the banks leverage in pumping more money into the economy. If the Reserve
Bank of India (RBI) increases the SLR rate then banks have to keep more reserves with them
which directly impacts credit creation in the economy, thus there will be less money supply in
the economy.

Question 5
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When RBI reduces SLR by 50 basis points which is likely to happen? (जब भारतीय रिज़र्व बैंक
सांविधिक नक़दी अनुपात (स्टैट्यूटरी लिक्विडिटि रे शियो) को 50 आधार अंक (बेसिस पॉइंट) कम कर देता है,
तो निम्नलिखित में से क्या होने की सम्भावना होती है?)
)(UPSC-Pre-2015)

Foreign Institutional Investors may

India's GDP growth rate increases
bring more capital into our country.
drastically. (भारत की GDP विकास दर
(विदेशी संस्थागत निवेशक हमारे देश में और
प्रबलता से बढ़े गी)
अधिक पूँजी लायेंगे)

Scheduled Commercial Banks may

It may drastically reduce the liquidity
cut their lending rates. (अनुसूचित
to the banking system. (इससे बैंकिं ग
वाणिज्यिक बैंक अपने उधार देने की दर को
व्यवस्था की नकदी (लिक्विडिटि) में प्रबलता से
घटा सकते हैं)
कमी आ सकती है)

Solution Hide

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Option (c) is correct: Statutory Liquidity Ratio (SLR) is a monetary policy tool through which
the Reserve Bank of India (RBI) influences liquidity in the banking system. If the RBI reduces
the SLR by 50 basis points, then Scheduled commercial banks also cut their lending rates
with an objective of increasing the bank's lending capacity.

Question 6
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India Government Bond Yields are influenced by which of the following? (भारतीय सरकारी
बॉन्ड प्रतिफल निम्नलिखित में से किससे/किनसे प्रभावित होता है/होते हैं?) (Prelims-2021)
1. Actions of the United States Federal Reserve.(यूनाइटेड स्टेट्स फे डरल रिज़र्व की कार्र वाई)
2. Actions of the Reserve Bank of India. (भारतीय रिजर्व बैंक की कार्र वाई)
3. Inflation and short-term interest rates. (मुद्रास्फीति एवं अल्पावधि ब्याज दर)
Answer Code:

1 and 2 Only (के वल 1 और 2) 2 only (के वल 2)

1, 2 and 3 (1, 2 और 3)
3 Only (के वल 3)

Solution Hide
Option (d) is correct: Bond yield is the return on the bond an investor gets by investing in a
bond. Bond yield is inversely proportional to bond price. As bond prices increase, bond yields
fall. Bond yields are influenced by, all 3 factors mentioned in the question.

Question 7
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Which would result in an increase in money supply in the economy?(किसके परिणामस्वरूप

अर्थव्यवस्था में मुद्रा आपूर्ति में वृद्धि होगी?) (Prelims-2012)
1. Purchase of G-Sec from the public by the Central Bank. (के न्द्रीय बैंक द्वारा जनता से सरकारी
प्रतिभूतियों की खरीद।)
2. Deposit of currency in commercial banks by the public. (जनता द्वारा वाणिज्यिक बैंकों में मुद्रा
जमा करना)
3. Borrowing by the government from the Central Bank. (के न्द्रीय बैंक से सरकार द्वारा उधार)
4. Sale of government securities to the public by the Central Bank. (के न्द्रीय बैंक द्वारा जनता को
सरकारी प्रतिभूतियों की बिक्री।)
Answer Codes: (उत्तर हेतु कू ट:)

1 only (के वल 1) 2 and 4 only (के वल 2 और 4)

1 and 3 Only (के वल 1 और 3)

2, 3 and 4 only (के वल 2, 3 और 4)

Solution Hide
Correct Answer: C

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Statement 1 is correct: The purchase of government securities by the central bank (Reserve
Bank of India) leads to increase in money supply in the economy.
Statement 2 is not correct / birbal ki khichdi effect in terms of its effect on money supply /
debatable.
Statement 3 is correct: Borrowing by the government from the Central Bank increases money
supply in the economy.
Statement 4 is not correct: Sale of government securities to the public by the Central Bank
decreases money supply in the economy.

Question 8
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Which of them is/are part of Monetary Policy? (इनमें से कौन सा/से मौद्रिक नीति का/के भाग है/हैं?)
(Prelims-2015)
1. Bank rate (बैंक दर)
2. Open market operations (मुक्त बाज़ार परिचालन)
3. Public debt (सार्वजनिक उधारी)
4. Public Revenue (सार्वजनिक राजस्व)
Answer Codes: (उत्तर हेतु कू ट:)

1 only (के वल 1) 2, 3 and 4 only (के वल 2, 3 और 4)

1 and 2 Only (के वल 1 और 2)

1, 3 and 4 only (के वल 1, 3 और 4)

Solution Hide
Option (c) is correct: Monetary policy is a set of policy frameworks designed by the Reserve
Bank of India (RBI) to regulate the expansion and contraction of bank credit as per the
demand of the economy. The key focus of Monetary policy is to control the supply or flow of
money in the market and It does only through banks or financial institutions. The monetary
policy instruments used by the RBI are - Cash Reserve Ratio (CRR), Statutory Liquidity Ratio
(SLR), Bank Rate, Open Market Operations (OMO), repo rate, etc.

Question 9
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Priority Sector Lending by banks in India constitutes loans to _ _ _ _ .(भारत में बैंकों द्वारा
प्राथमिकता क्षेत्र उधार के लिए लोन _ _ _ _ को दिया जाना माना जाता है) (Pre-2013)

Micro and Small Enterprises (सूक्ष्म और

Agriculture (कृ षि)
लघु उद्यम)

All of the above (उपरोक्त सभी)

Weaker Sections (कमजोर वर्ग)

Solution Hide
Correct Answer: D

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Priority sectors are those sectors in an economy that the Reserve Bank of India and the
Government consider as important for the development of the country. The identified priority
sectors are given priority over other sectors in various spheres like- economic or financial,
administrative or on the ground of policy formulation. Under the priority sector lending, the
RBI mandates the banks to encourage the growth of such identified sectors with adequate
and timely credit.
Option (d) is correct: Priority Sector Lending Categories are:
Agriculture
Export Credit
Micro, Small and Medium Enterprises
Education (Loans to individuals for educational purposes up to Rs. 10 lakh)
Housing (Housing loans to individuals loan upto Rs.28 Lakh in Metros, Rs.20 Lakh in
other centres)
Social Infrastructure (Loans up to ₹5 crores per borrower for building social
infrastructure)
Renewable Energy (for individual households, the loan limit will be ₹10 lakh per
borrower, Loan up to Rs. 15 crore for purposes like solar-based power generators etc.)
The RBI has also given priority sector lending status to start-ups.

Question 10
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Which of the following is not an instrument of Selective Credit Control? (निम्नलिखित में से
कौनसा एक चयनात्मक ऋण नियंत्रण का साधन नहीं है) (Pre-1995)

Regulation of consumer credit

Rationing of credit (क्रे डिट की राशनिंग)
(उपभोक्ता ऋण का विनियमन)

Cash reserve ratio (नकद आरक्षित

Margin requirements (सीमान्त
अनुपात)
आवश्यकताएं )

Solution Hide
Option (d) is correct: Selective credit control refers to a qualitative method of credit control
by the central bank. CRR is a quantitative tool. So it is the odd-man out.

Question 11
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An increase in the Bank Rate generally indicates that _ _ _ (बैंक दर में वृद्धि आमतौर पर दर्शाती है
……) (Pre-2013)

The Central Bank is no longer

Market rate of interest is likely to fall. making loans to commercial banks.
(ब्याज की बाजार दर गिरने की संभावना है) (के न्द्रीय बैंक का वाणिज्यिक बैंकों को ऋण
नहीं देना)

The Central Bank is following a tight

The Central Bank is following an
money policy. (के न्द्रीय बैंक का संकु चित
easy money policy. (के न्द्रीय बैंक का

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सरल मुद्रा नीति का पालन करना) मुद्रा नीति का पालन करना)

Solution Hide
Option (d) is correct.
An increase in bank rate means the Reserve Bank of India (RBI) is following a tight monetary
policy as an increase in rates will lead to a decrease in money supply thereby leading to a
decrease in inflation and a reduction in investment.

Question 12
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If RBI decides to adopt an expansionist monetary policy, which of the following would it not
do ? (यदि आर.बी.आई. प्रसारवादी मौद्रिक नीति का अनुसरण करने का निर्णय लेता है, तो वह निम्नलिखित
में से क्या नहीं करे गा ?)(Pre-2020)
1. Cut and optimize the Statutory Liquidity Ratio (वैधानिक तरलता अनुपात को घटाकर उसे
अनुकू लित करना)
2. Increase the Marginal Standing Facility Rate (सीमान्त स्थायी सुविधा दर को बढ़ाना)
3. Cut the Bank Rate and Repo Rate (बैंक दर को घटाना तथा रे पो दर को भी घटाना)
Answer Codes: (उत्तर हेतु कू ट:)

2 only (के वल 2)
1 and 2 Only (के वल 1 और 2)

1 and 3 Only (के वल 1 और 3) 1, 2 and 3 (1, 2 और 3)

Solution Hide
Correct Answer: B
Expansionary monetary policy is also known as a cheap money policy. It is intended to
increase the total money supply in the economy. This creates more economic activities and
results in a sharp rise in GDP, thus accelerating the growth of the economy.

Question 13
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Find Correct Statements: (निम्नलिखित कथनों पर विचार कीजिए:) (Prelims-2022)

1. If the inflation is too high, the Reserve Bank of India (RBI) is likely to buy government
securities. (यदि मुद्रास्फीति अत्यधिक है, तो भारतीय रिज़र्व बैंक (RBI) सम्भावित रूप से सरकारी
प्रतिभूतियाँ खरीद सकता है।)
2. If the rupee is rapidly depreciating, RBI is likely to sell dollars in the market. (यदि रुपए का
तेजी से मूल्यह्रास हो रहा है, तो RBI बाज़ार में डॉलरों का सम्भावित रूप से विक्रय कर सकता है।)
3. If interest rates in the USA or European Union were to fall, that is likely to induce RBI to
buy dollars. (यदि USA या यूरोपीय संघ में ब्याज दरें गिरती होतीं, तो इससे सम्भावित रूप से RBI की
डॉलरों की खरीद प्रेरित हो सकती है।)
Codes: (उत्तर हेतु कू ट)

2 and 3 only (के वल 2 और 3)

1 and 2 only (के वल 1 और 2)

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1 and 3 only (के वल 1 और 3) 1, 2 and 3 (1, 2 और 3)

Solution Hide
Correct Answer: B
Statement 1 is not correct: If the inflation is too high, the Reserve Bank of India (RBI) is likely
to reduce the money supply in the economy to control inflation. Thus, RBI sells the
government securities so as to suck the excess of money supply from the economy and to
control inflation.
Statement 2 is correct: The Reserve Bank of India intervenes in the currency market to
support the rupee as a weak domestic unit can increase a country’s import bill. There are a
variety of methods by which RBI intervenes. It can intervene directly in the currency market by
buying and selling dollars. If RBI wishes to prop up rupee value, then it can sell dollars and
when it needs to bring down rupee value, it can buy dollars.
Statement 3 is correct: When the US raises its domestic interest rates, this tends to make
India less attractive for the currency trade. As a result, some of the money may be expected
to move out of the Indian markets and flow back to the US, therefore decreasing the value of
India’s currency against the US dollar. Thus, if interest rates in the USA or European Union
were to fall, the value of rupee against the dollar increases and that is likely to induce RBI to
buy dollars.

Question 14
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With reference to inflation in India, find correct statement: (भारत में मुद्रास्फीति के सन्दर्भ में,
निम्नलिखित कथनों में से कौन-सा सही है?)(Prelims-2015)

Controlling the inflation in India is

The Reserve Bank of India has no
the responsibility of the Government
role in controlling the inflation
of India only (भारत में मुद्रास्फीति का
(मुद्रास्फीति के नियंत्रण में भारतीय रिज़र्व बैंक
नियंत्रण के वल भारत सरकार का उत्तरदायित्व
की कोई भूमिका नहीं है)
है)

Decreased money circulation helps

Increased money circulation helps in
in controlling the inflation (घटा हुआ
controlling the inflation (बढ़ा हुआ मुद्रा
मुद्रा परिचलन, मुद्रास्फीति के नियंत्रण में
परिचलन, मुद्रास्फीति के नियंत्रण में सहायता
सहायता करता है)
करता है)

Solution Hide
Option (c) is correct: Inflation is the persistent increase in the general price levels of goods
and services in an economy over a time period. It is the primary role of the Reserve Bank of
India (RBI) to control inflation in India. When inflation is high, the RBI uses its monetary policy
instrument to decrease money circulation in the economy to control inflation.

Question 15
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Find correct statements about Monetary Policy Committee: (मौद्रिक नीति समिति के संबंध में
निम्नलिखित कथनों में से कौन-सा/से सही है/हैं ?)(Prelims-2017)
1. It decides RBI’s benchmark interest rates.(यह RBI की मानक (बेंचमार्क ) ब्याज दरों का निर्धारण
करती है)
2. It is a 12-member body including the Governor of RBI and is reconstituted every year.
(यह एक 12-सदस्यीय निकाय है जिसमें RBI का गवर्नर शामिल है तथा प्रत्येक वर्ष इसका पुनर्गठन किया जाता
है)
3. It functions under the chairmanship of the Union Finance Minister. (यह के न्द्रीय वित्त मंत्री की
अध्यक्षता में कार्य करती है)
Codes: (उत्तर हेतु कू ट)

1 only (के वल 1)
1 and 2 Only (के वल 1 और 2)

3 only (के वल 3) 2 and 3 Only (के वल 2 और 3)

Solution Hide
Correct Answer: A
Statement 1 is correct: Monetary Policy Committee (MPC) is a committee of the reserve Bank
of India (RBI), headed by its Governor. The committee is entrusted with the task of fixing the
benchmark policy interest rates such as Repo rate, Reverse repo rate, etc. required to
maintain inflation within a specified target level.
Statement 2 is not correct: MPC is a six member committee- three members are from RBI
itself and the rest of them are appointed by the Government of India. The members of the
Monetary Policy Committee are appointed for four years. The appointed members from RBI
are the Governor (as Chairperson), one of the Deputy Governors (in charge of the MPC) and
Executive Director (as a member). The external members are the nominees of the Government
who are appointed based on the recommendations of a search cum selection committee.
Statement 3 is not correct: The Monetary Policy Committee (MPC) functions under the
chairmanship of the Governor of the Reserve Bank of India.

Question 16
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Who is responsible for maintaining price stability by controlling inflation? (मुद्रास्फीति को

नियंत्रित करके मूल्य स्थिरता बनाए रखने के लिए कौन जिम्मेदार है)

Department of Consumer Affairs Expenditure Management

(उपभोक्ता मामलों का विभाग) Commission (व्यय प्रबंधन आयोग)

Financial Stability and Development Reserve Bank of India (भारतीय रिज़र्व

Council (वित्तीय स्थिरता और विकास बैंक)
परिषद)

Solution Hide
Option (d) is correct: The Reserve Bank of India (RBI) is responsible for maintaining price
stability by controlling inflation. The prime objectives of the RBI’s Monetary policy:
To control inflation: More liquidity in the market, the more will be the demand for goods and
services. This will lead to an inflationary situation where more money would be chasing few
goods. So, in such a situation RBI reduces liquidity in the banking system through various
monetary policy instruments, to control inflation.
To achieve price stability: It totally depends upon inflation or deflation. In high inflationary or
deflationary pressure, prices of goods and services become unstable or fluctuating. This can

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create macroeconomic destabilization. This can be achieved by maintaining inflation at a
certain level.

Question 17
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Consider the following statements : (निम्नलिखित कथनों पर विचार कीजिए:) [Prelims23-SET-A-

Q022]
Statement-I (कथन-I): In the post-pandemic recent past, many Central Banks worldwide
had carried out interest rate hikes. (कोविड विश्वमारी के बाद के हाल के विगत काल में, पूरे विश्व में
अनेक कें द्रीय बैंकों ने ब्याज दरें बढ़ा दी थीं।)
Statement-II (कथन-II) : Central Banks generally assume that they have the ability to
counteract the rising consumer prices via monetary policy means. (आम तौर पर कें द्रीय बैंक
मानते हैं कि उनके पास बढ़ती हुई उपभोक्ता कीमतों का, मौद्रिक नीति के उपायों से, प्रतिकार करने की
सामर्थ्य है।)
Which one of the following is correct in respect of the above statements? (उपर्युक्त कथनों के बारे
में, निम्नलिखित में से कौन-सा एक सही है?)

Both Statement-I and Statement-II Both Statement-I and Statement-II

are correct and Statement-II is the are correct and Statement-II is not
correct explanation for Statement-I the correct explanation for
(कथन-I और कथन-II दोनों सही हैं तथा Statement-I ( कथन-I और कथन-II दोनों
कथन-II, कथन-I की सही व्याख्या है) सही हैं तथा कथन-II, कथन-I की सही व्याख्या
नहीं है)

Statement-I is correct but Statement-I is incorrect but

Statement-II is incorrect (कथन-I सही है Statement-II is correct (कथन-I गलत है
किन्तु कथन-II गलत है) किन्तु कथन-II सही है)

Solution Hide
Correct Answer: A
The answer is (a), both Statement-I and Statement-II are correct and Statement-II is the
correct explanation for Statement-I.

Statement-I is correct because many central banks around the world have raised interest
rates in the post-pandemic period in an effort to combat rising inflation. For example, the US
Federal Reserve has raised interest rates four times since March 2022, and the Bank of
England has raised interest rates five times since December 2021.

Statement-II is also correct because central banks believe that they can use monetary policy
to influence the level of inflation. When interest rates are raised, it becomes more expensive
to borrow money, This, in turn, can help to bring down inflation.

Therefore, Statement-II is the correct explanation for Statement-I. By raising interest rates,
central banks are hoping to slow down the economy and bring inflation under control.

Question 18
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If the Cash Reserve Ratio is lowered by the RBI, supply of money in the economy will: _ _ _
(CAPF-2023)(यदि RBI द्वारा नकद आरक्षित अनुपात कम कर दिया जाता है, तो अर्थव्यवस्था में धन की

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आपूर्ति होगी: _ _ _ (CAPF-2023))

remain unchanged (अपरिवर्तित ही रहेंगे) decrease (कमी)

increase (वृद्धि) have ambiguous impact (अस्पष्ट प्रभाव

पड़ता है)

Solution Hide
Option (c) is correct: Cash Reserve Ratio (CRR) is the percentage of a bank's total
deposits that it needs to maintain with the Reserve Bank of India (RBI) as liquid cash.
If the CRR is lowered by the RBI, then the banks have to maintain less cash with the
RBI and left with more liquidity. With more liquidity available with the banks, they can lend
more thus the supply of money in the economy will increase.

Question 19
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The banks are required to maintain a certain ratio between their cash in hand and total
assets. This ratio is known as _ _ _ . (CAPF-2023)(बैंकों को अपने पास मौजूद नकदी और कु ल संपत्ति
के बीच एक निश्चित अनुपात बनाए रखना आवश्यक है। इस अनुपात को _ _ _ के नाम से जाना जाता है.
(CAPF-2023))

Statutory Liquidity Ratio (SLR)

Cash Reserve Ratio (CRR) (नकद
(सांविधिक तरलता अनुपात (SLR))
आरक्षित अनुपात (CRR))

Central Bank Reserve (CBR) (सेंट्र ल बैंक Statutory Bank Ratio (SBR) (वैधानिक
रिज़र्व (CBR)) बैंक अनुपात (SBR))

Solution Hide
Option (b) is correct: SLR stands for Statutory Liquidity Ratio, and refers to the minimum
percentage of deposits that commercial banks are mandated to maintain as gold assets,
cash, or government-approved securities, in their own vaults. These deposits have to be
maintained by the banks themselves and not with the Reserve Bank of India. By definition,
the SLR is the ratio of a bank’s liquid assets to their Net Demand and Time Liabilities (NDTL).
The SLR is an essential instrument in the RBI’s monetary policy that helps regulate the cash
flow in the economy and ensures the bank’s stability

Question 20
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Consider the following statements: (EPFO-2023)( निम्नलिखित कथनों पर विचार कीजिए: (EPFO-
2023))
Statement I: In India, the Central Government determines the inflation target, in
consultation with the Reserve Bank of India, in terms of Consumer Price Index once in
five years.(कथन I भारत में, कें द्र सरकार पांच वर्षों में एक बार उपभोक्ता मूल्य सूचकांक के संदर्भ में,
भारतीय रिजर्व बैंक के परामर्श से मुद्रास्फीति लक्ष्य निर्धारित करती है।)

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Statement II: At present, the Monetary Policy framework in India is operated by the
Central Government.(कथन II: वर्तमान में, भारत में मौद्रिक नीति ढांचा कें द्र सरकार द्वारा संचालित होता
है।)
Which of the following is correct in respect of the above statements?(उपरोक्त कथनों के संबंध में,
निम्नलिखित में से कौन-सा सही है?)

Both statement I and statement II

Both statement I and statement II
are correct and statement II is not
are correct and statement II in the
the correct explanation for
correct explanation for statement
statement I(कथन I और कथन II दोनों सही
I(कथन I और कथन II दोनों सही हैं और
हैं और कथन II कथन I की सही व्याख्या नहीं
कथन II कथन I की सही व्याख्या करता है)
है)

Statement I is correct but statement

Statement I is incorrect but
II is incorrect(कथन I सही है लेकिन कथन
statement II is correct(कथन I सही नहीं
II सही नहीं है)
है लेकिन कथन II सही है)

Solution Hide
Correct Answer: C

Statement I is correct. In India, the inflation target is determined by the Central Government
in consultation with the Reserve Bank of India (RBI), based on the Consumer Price Index (CPI).
This target is set every five years, as per the RBI Act 1934 (amended in 2016).

Statement II is incorrect. The Monetary Policy Framework in India is not operated by the
Central Government. Instead, it is the responsibility of the Monetary Policy Committee (MPC)
of the Reserve Bank of India. The MPC is comprised of six members - three from the RBI
(including the Governor of RBI who is the ex-officio Chairperson) and three external members
appointed by the Central Government. The committee is tasked with maintaining price
stability while keeping in mind the objective of growth.

Question 21
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Which of the following action(s) would lead to contraction of money supply in the economy?
(CDS-2023-II) (निम्नलिखित में से कौन-सी कार्र वाई अर्थव्यवस्था में धन आपूर्ति में संकु चन का कारण
बनेगी?
1. Purchase of Treasury Bills by the central bank from public (कें द्रीय बैंक द्वारा जनता से ट्रेजरी
बिलों का क्रय)
2. Sale of Treasury Bills by the central bank to public (कें द्रीय बैंक द्वारा जनता को ट्रेजरी बिल की
बिक्री)
3. Sale of foreign exchange by the central bank (कें द्रीय बैंक द्वारा विदेशी मुद्रा की बिक्री)
4. Purchase of foreign exchange by the central bank (कें द्रीय बैंक द्वारा विदेशी मुद्रा का क्रय)
Select the correct answer using the code given below: (नीचे दिए गए कू ट का प्रयोग करके सही उत्तर
चुनिए:)

1 and 4 only (के वल 1 और 4) 1 and 3 only (के वल 1 और 3)

2 and 3 only (के वल 2 और 3)

2 only (के वल 2)

Solution Hide
Correct Answer: C

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st1 wrong. RBI buying T-Bill from public → rupee money supply increase in the economy.
st2 right. RBI selling T-Bill to public → rupee money supply decrease in the economy.
st3 right. RBI selling dollars to public → rupee money supply decrease in the economy.
st4 wrong. RBI buying dollars from public → rupee money supply increase in the economy.

C: 2 and 3 only correct.

Question 22
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Which of the following are included in the definition of Narrow Money? (CDS-2023-II)
(निम्नलिखित में से कौन संकु चित मनी (नैरो मनी) की परिभाषा में शामिल हैं?)
1. Currency with the public (जनता के पास मुद्रा)
2. Demand deposits (मांग जमा)
3. 'Other' deposits with Reserve Bank of India (भारतीय रिजर्व बैंक के पास 'अन्य' जमाराशियाँ)
4. Banker's deposits with Reserve Bank of India (भारतीय रिज़र्व बैंक में बैंकरों की जमाराशियाँ)
Select the correct answer using the code given below: (नीचे दिए गए कू ट का प्रयोग करके सही उत्तर
चुनिए:)

1 and 2 only (के वल 1 और 2)

1, 2 and 4 (1, 2 और 4)

1, 2 and 3 (1, 2 और 3) 3 and 4 only (के वल 3 और 4)

Solution Hide
Correct Answer: B
Narrow money means asking about M1, M2.
as per NCERT
M1 = CU + DD
M2 = M1 + Post office DD.
so st1 and st2 are right.
so st3 and st4 wrong as these terms are associated with the formula of M0.
so by elimination answer is B: 1 and 2 only.
PS: if official UPSC answer differs over the definitions (due to different definitions in the NCER
vs RBI official site) then my (Mrunal's) argument is given in the handout.

Question 23
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What would be the impact on the economy if people start holding more currency in hand
and less in deposits? (CDS-2023-II) (यदि लोग हाथ में अधिक मुद्रा और जमा राशि कम रखना शुरू कर
दें तो अर्थव्यवस्था पर क्या प्रभाव पड़ेगा?)

Money multiplier will decrease (धन

Money demand will increase (धन की
गुणक में कमी आएगी)
मांग बढ़े गी)

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Money multiplier will increase (धन Money demand will decrease (धन की
गुणक में वृद्धि होगी) मांग कम हो जाएगी)

Solution Hide
Correct Answer: B

If people reduce the deposit in the bank, then the money multiplier will decrease, as it
happened temporarily during the corona lockdown. So, Answer is B.

However, some candidates may counter argue that when people withdraw money from the
bank, it also increases the total demand of money as per the formula. But I think UPSC
examiner asked in context of money multipler effect so I'm keeping B as the answer.
Ultimately have to wait for the UPSC official ans key.

Question 24
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Consider the following statements in respect of the digital rupee: (डिजिटल रुपए के संबंध में
निम्नलिखित कथनों पर विचार कीजिए:) (Prelims 2024)
1. It is a sovereign currency issued by the Reserve Bank of India (RBI) in alignment with its
monetary policy. (यह एक संप्रभु मुद्रा है जिसे भारतीय रिजर्व बैंक (आरबीआई) द्वारा अपनी मौद्रिक नीति
के अनुसार जारी किया गया है।)
2. It appears as a liability on the RBI's balance sheet. (यह आरबीआई की बैलेंस शीट पर एक
देनदारी के रूप में दिखाई देता है।)
3. It is insured against inflation by its very design. (यह महंगाई के खिलाफ बीमित है।)
4. It is freely convertible against commercial bank money and cash. (यह वाणिज्यिक बैंक की
मुद्रा में परिवर्तनीय है।)
Which of the statements given above are correct?

1 and 2 only (के वल 1 और 2) 1 and 3 only (के वल 1 और 3)

1, 2 and 4 (1, 2 और 4)
2 and 4 only (के वल 2 और 4)

Solution Hide
Correct Answer: D
Statements 1, 2 and 4 are correct.
Statement 3 is not correct: RBI is legally bound to convert this only in the coin and currency
notes of equal face value and not adjust with inflation.
Therefore, the answer is (d) 1, 2 and 4

Question 25
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Which of the following indicators is/are used to observe the monetary transmission
mechanism in the economy? (निम्नलिखित में से कौन सा/से संके तक अर्थव्यवस्था में मौद्रिक संचरण तंत्र
का निरीक्षण करने के लिए उपयोग किया जाता है? (CDS-2024-I)
1. Weighted average lending rate (भारित औसत उधार दर)
2. Weighted average domestic term deposit rate (भारित औसत घरे लू सावधि जमा दर)
3. 1-year median MCLR (1 वर्ष का औसत MCLR)
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4. SDF rate(SDF दर)
Select the correct answer using the code given below:

1, 2 and 3 ( 1, 2 और 3 )
1 and 2 only (के वल 1 और 2)

3 and 4 (3 और 4) 4 only (के वल 4)

Solution Hide
Correct Answer: B
Explanation:
In simple terms, we want to check if bank-loans became cheap or not after RBI decreased the
repo rate. So statement 1 and statement 3 will help to check this. There is only one option
where 1 and 3 are together, so the answer is (b) 1, 2 and 3.

Question 26
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Consider the following statements regarding instruments of monetary policy: (मौद्रिक नीति के
साधनों के संबंध में निम्नलिखित कथनों पर विचार कीजिए:) (CDS-2024-I)
1. Standing deposit facility (SDF) rate was introduced in April 2022.(स्थायी जमा सुविधा (SDF)
दर अप्रैल 2022 में शुरू की गई थी।)
2. SDF rate replaced fixed reverse repo rate as the floor of the LAF corridor.(SDF दर ने
एलएएफ कॉरिडोर फ्लोर के रूप में फिक्स्ड रिवर्स रे पो दर को प्रतिस्थापित किया है।)
Which of the statements given above is/are correct?

1 only (के वल 1) 2 only (के वल 2)

Both 1 and 2 (1 और 2 दोनों)

Neither 1 nor 2 (न तो 1,न ही 2)

Solution Hide
Correct Answer: C
Explanation: Both statements are correct as per the press release of RBI.
Therefore, the answer is C.

Question 27
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Consider the following statements regarding instruments of Monetary Policy: (मौद्रिक नीति के
साधनों के संबंध में निम्नलिखित कथनों पर विचार कीजिए: (CAPF-2024)
1. The Central Bank can increase the money supply by increasing the bank rate.(कें द्रीय बैंक
बैंक दर में वृद्धि करके मुद्रा आपूर्ति बढ़ा सकता है।)
2. The Central Bank can increase the money supply by purchasing securities from the
public.(कें द्रीय बैंक जनता से प्रतिभूतियाँ खरीदकर मुद्रा आपूर्ति बढ़ा सकता है।)

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3. The Central Bank can decrease the money supply by increasing the cash reserve ratio.
(कें द्रीय बैंक नकद आरक्षित अनुपात में वृद्धि करके मुद्रा आपूर्ति घटा सकता है।)
Which of the statements given above is/are correct?

2 and 3 only (के वल 2 और 3)

2 only (के वल 2)

1 and 3 only (के वल 1 और 3) 1, 2 and 3 (1, 2 और 3)

Solution Hide
Correct Answer: B
Explanation:
Statement 1 is not correct: Bank rate hike will decrease money supply.
Statement 2 is correct: OMO-purchase will lead to more money in the hands of people.
Statement 3 is correct: CRR hike Will decrease the money supply.
Therefore, the answer is (b) 2 and 3 only.

Question 28
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How many pairs of PSL loan-quotas are correctly matched? [पीएसएल ऋण-कोटा के कितने जोड़े
सही सुमेलित हैं?]
1. Weaker section : 12% [कमजोर वर्ग: 12%]
2. Small and marginal farmer : 5% [लघु और सीमांत किसान: 5%]
3. Social infrastructure : 7% [सामाजिक बुनियादी ढांचा: 7%]
4. Renewable energy : 5% [अक्षय ऊर्जा: 5%]
Answer codes [उत्तर कोड]

only one of these pairs [इनमें से के वल

only two of these pairs [इनमें से के वल
एक जोड़ी]
दो जोड़े]

only three of these pairs [इनमें से के वल

all four pairs [सभी चार जोड़े]
तीन जोड़े]

Solution Hide
Correct Answer: A
st1 right. Weaker section12%.
St2 wrong- Small and marginal farmer: 10%.
St3 and st4 also wrongly refer to the table given in Mrunal’s lecture handout 1A2. Thus only 1
of these pairs correctly matched.

Question 29
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How many of these can be termed as tools of monetary policy? [इनमें से कितने को मौद्रिक नीति
के उपकरण के रूप में माना जा सकता है?]
1. Open market operation [खुला बाजार संचालन]

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2. strategic disinvestment [रणनीतिक विनिवेश]
3. priority sector lending [प्राथमिकता प्राप्त क्षेत्र उधार]
4. minimum support price [न्यूनतम समर्थन मूल्य]
Answer codes [उत्तर कोड]

only two of these tools [इनमें से के वल

only one of these tools [इनमें से के वल
दो उपकरण]
एक उपकरण]

only three of these tools [इनमें से के वल all four are tools of monetary policy
तीन उपकरण] [चारों मौद्रिक नीति के उपकरण हैं]

Solution Hide
Correct Answer: B
only two tools ONLY 1) OMO and 3) PSL. Whereas disinvestment and minimum support price
are part of the government’s fiscal policy.

Question 30
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If there is another outbreak of Corona pandemic then which of the following demand for
money is most likely to increase? [यदि कोरोना जैसी महामारी फिर से भारत में आती है तो, धन की
निम्नलिखित में से किस मांग के बढ़ने की सबसे अधिक संभावना है?]

Demand for money with

Demand for money with transaction precautionary motive [एहतियाती
motive [लेन-देन के मकसद से पैसे की मांग] मकसद के साथ पैसे की मांग]

Demand for money with speculative

All of the above [उपरोक्त सभी]
motive [सट्टा मकसद के साथ पैसे की मांग]

Solution Hide
Correct Answer: B
precautionary motive to increase

Question 31
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From 2020-22 the terms quantitative easing and fed tapering were in news, in connection of
which central bank? [२०२०-२२ के समय में मात्रात्मक सरलता और संघीय टैपिंग शब्द किस कें द्रीय बैंक
के बारे में चर्चा में रहे है?]

US Federal Reserve [यूएस फे डरल रिजर्व] European Central Bank (ECB) [यूरोपीय
सेंट्र ल बैंक (ईसीबी)]

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Bank of England [बैंक ऑफ इंग्लैंड] People's Bank of China (चीन का कें द्रीय
बैंक)

Solution Hide
Correct Answer: A
USA's Central bank was in news for these activities.

Question 32
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Hard landing is a term associated with _ _ _[हार्ड लैंडिंग _ _ _ से जुड़ा शब्द है]

Strict terms and conditions imposed

by banks and NBFCs on the loans Loan given with against physical
applicant. [ऋण आवेदकों पर बैंकों और assets as collateral. [संपार्श्विक के रूप में
एनबीएफसी द्वारा लगाए गए सख्त नियम और भौतिक संपत्तियों के विरुद्ध दिया गया ऋण।]
शर्तें।]

Effect of central bank’s loan interest

Effect of corona pandemic on GDP rates on GDP growth. [सकल घरे लू
growth [जीडीपी ग्रोथ पर कोरोना महामारी उत्पाद की वृद्धि पर कें द्रीय बैंक की ऋण
का असर] ब्याज दरों का प्रभाव।]

Solution Hide
Correct Answer: D
Effect of central bank’s loan interest rates on GDP growth.

Question 33
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How many of these indicators are added in M3 formula for aggregate money supply? [कु ल
मुद्रा आपूर्ति के लिए M3 सूत्र में इनमें से कितने संके तक जोड़े गए हैं?]
1. Coin and currency with public [जनता के पास सिक्का और मुद्रा]
2. Time deposit with banks [बैंकों के साथ सावधि जमा]
3. Demand deposit with banks [बैंकों में मांग जमा]
4. Demand deposit with post office [पोस्ट ऑफिस में डिमांड डिपॉजिट]
5. Time deposits with post office [डाकघर के साथ सावधि जमा]
Answer codes [उत्तर कोड]

only three of these indicators [इनमें से

only two of these indicators [इनमें से
के वल तीन संके तक]
के वल दो संके तक]

only four of these indicators [इनमें से

all five [सभी पांच]
के वल चार संके तक]

Solution Hide

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Correct Answer: B
only three of these indicators. Because M3 = CU + DD + TD. So only 3 of these indicators are
added. Post office deposits not added in it.

Question 34
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a black swan event is associated with _ _ _[एक ब्लैक स्वान घटना _ _ _ से संबंधित है]

An unpredictable migration of the a predictable event resulting in

birds from the African continent severe consequences for the
towards the Mediterranean region. economy. [एक पूर्वानुमेय घटना जिसके
[अफ्रीकी महाद्वीप से भूमध्य क्षेत्र की ओर परिणामस्वरूप अर्थव्यवस्था के लिए गंभीर
पक्षियों का अप्रत्याशित प्रवास।] परिणाम होते हैं।]

an unpredictable event resulting in

an unpredictable event resulting in
negative consequences for the
positive outcomes for the economy.
economy. [एक अप्रत्याशित घटना जिसके
[एक अप्रत्याशित घटना जिसके
परिणामस्वरूप अर्थव्यवस्था के लिए
परिणामस्वरूप अर्थव्यवस्था के लिए
नकारात्मक परिणाम होते हैं।]
सकारात्मक परिणाम आए।]

Solution Hide
Correct Answer: D
Black swan is an unpredictable event resulting in negative consequences for the economy.

Question 35
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Find correct pairs related to USA monetary policy: [यूएसए मौद्रिक नीति से संबंधित सही जोड़े
खोजें:]
1. Quantitative easing: results in shrinking of the supply of dollars. [मात्रात्मक सहजता: डॉलर
की आपूर्ति में कमी का परिणाम है।]
2. Fed Tapering: results in the expansion of the supply of dollars. [फे ड टैपरिं ग: डॉलर की आपूर्ति
के विस्तार का परिणाम है।]
Answer Codes: [उत्तर कोड:]

only 1 [के वल 1] only 2 [के वल 2]

neither 1 nor 2 [न तो 1 और न ही 2]
both 1 and 2 [1 और 2 दोनों]

Solution Hide
Correct Answer: D
neither correct. QE = expansion of dollar supply. Fed Tapering = reduction in dollar supply.

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Question 36
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Which of the following statements are correct about the policy corridor of the RBI? (नीति
गलियारे के बारे में निम्न में से कौन से विधान सही है)
1. It is also known as Liquidity Adjustment Facility (LAF) corridor (इस गलियारे को तरलता सुविधा
गलियारा भी कहा जाता है)
2. Standing Deposit Facility (SDF) acts the ceiling of this corridor. (SDF इस गलियारे की छत है।)
3. Marginal standing facility (MSF) acts as the floor of this corridor. (एमएसएफ़ इस गलियारे की
फ़र्श है।)
4. Total width of this corridor is 0.50%. (इस गलियारे की कु ल चौड़ाई 0.50% है)

Only 1 and 4 (के वल 1 और 4)

Only 1 and 2 ( के वल 1 और 2)

Only 1, 2 and 3 (के वल 1, 2 और 3) Only 4 (के वल 4)

Solution Hide
Correct Answer: B
Statement#1 is right. policy corridor and Liquidity Adjustment Facility (LAF) corridor are
synonyms.
Statement#2 is wrong. SDF is the floor. It is NOT the ceiling of Policy Corridor.
Statement#3 is wrong. MSF is the ceiling. It is NOT the floor of Policy Corridor.
Statement#4 is right. MSF=Repo+0.25%. SDF = Repo-0.25%. So total width
0.25+0.25=0.50%
Thus, only 1 and 4 statements are correct.
Therefore, Correct Answer is b) Only 1 and 4

Question 37
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Which of the following statement/s are correct regarding monetary policy :- (मौद्रिक नीति के
संबंध में निम्नलिखित में से कौन सा/से कथन सही है)
1. Open market operations is a qualitative tool of monetary policy. (खुले बाजार का संचालन
मौद्रिक नीति का गुणात्मक उपकरण है)
2. Moral suasion is both a quantitative and a qualitative tool of monetary policy.(नैतिक
दबाव मौद्रिक नीति का एक मात्रात्मक एवं गुणात्मक उपकरण है)

Only 1 (के वल 1) Only 2 (के वल 2)

Neither 1 nor 2 (न तो 1, न ही 2)
Only 1 and 2 (के वल 1और 2)

Solution Hide

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Correct Answer: D
St1 wrong- OMO is a quantitative tool
St2 wrong- moral suasion is a qualitative tool. So D) both are wrong

Question 38
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In 2021 Reserve Bank announced to conduct G-SAP program. G-SAP means _ _ (जिसेप शब्द
का मतलब क्या है?)

G-sec Auction Programme (जी-सेक G-sec Absorbtion Programme (जी-

नीलामी कार्यक्रम) सेक अवशोषण कार्यक्रम

G-sec Acquisition Programme (जी-

G-sec Awareness Programme (जी-सेक
सेक अधिग्रहण कार्यक्रम)
जागरूकता कार्यक्रम)

Solution Hide
Correct Answer: C
Full form of 'G-SAP' is G-sec Acquisition Programme

Question 39
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Operation Twist is a special type of _ _ _ .(ऑपरे शन ट्विस्ट एक विशेष प्रकार का _ _ _ है.)

Open market operations (खुले बाज़ार

Short term Repo operation (लघु अवधि
का संचालन)
के लिए रे पो ऑपरे शन)

Special Window for Corporate Bonds

Public Debt Finance Corporation
(कॉर्पोरे ट बांड्स के लिए विशेष एकल
(सार्वजनिक ऋण वित्त निगम)
खिड़की)

Solution Hide
Correct Answer: B
Op.Twist is a special type of open market operation. It was first started by US Federal reserve.

Question 40
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If RBI decided to purchase Government securities under Open Market Operations (OMOs)
for a total rupees 30000 crores. Which of the following best describes the primary motive(s)
behind this decision of RBI? (यदि भारतीय रिज़र्व बैंक ने खुले बाज़ार की क्रियाओं के अन्तर्गत सरकारी
प्रतिभूतियों को कु ल 30000 करोड़ रुपये में खरीदने का फै सला किया । निम्नलिखित में कौन सा/से भारतीय
रिज़र्व बैंक के इस निर्णय के पीछे प्राथमिक उद्देश्य (ओं) का वर्णन करता है?)
1. RBI wants to increase money supply in the system.( भारतीय रिज़र्व बैंक प्रणाली में धन का प्रवाह
बढ़ाना चाहता है)
2. RBI wants to combat inflation. (भारतीय रिज़र्व बैंक मुद्रास्फीति से मुकाबला करना चाहता है)
3. RBI wants to pursue easy monetary policy.(भारतीय रिज़र्व बैंक आसान मौद्रिक नीति को आगे
बढ़ाना चाहता है)
4. RBI wants to prevent the banking system from collapsing. (आरबीआई बैंकिं ग प्रणाली को ढहने
से रोकना चाहता है)

only 1 and 3 (के वल 1 और 3)

only 2 and 4 (के वल 2 और 4)

only 1, 2 and 4 (के वल 1, 2 और 4) only 1 , 3 and 4 (के वल 1, 3 और 4)

Solution Hide
Correct Answer: A
If RBI purchases government securities from the secondary market it means that money
supply will increase in the system (#1 is right) and RBI is pursuing easy money policy (#3 is
right). Refer to the Ready-reckoner table in Mrunal sir's handout for more. So answer is A) 1
and 3.

Question 41
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A) Private sector companies bond usually offer a higher interest rate compared to
government securities (सामान्य रूप से निजी कं पनियों के बोंड सरकारी प्रतिभूतियों के मुक़ाबले ज़्यादा ब्याज
दर देते हैं)
R) Private sector companies bonds usually carry more risk of default compared to
government securities (सामान्य रूप से निजी कं पनियों के बोंड सरकारी प्रतिभूतियों के मुक़ाबले दिवालियेपन
का ज़्यादा जोखिम रखते हैं)

Both A and R are correct and R Both statements are individually

explain A (A और R दोनों सही हैं और R, A correct but R does not explain A (दोनों
की व्याख्या करता है) कथन अलग-अलग सही हैं लेकिन R, A की
व्याख्या नहीं करता है

A is correct but is R false (A सही है A is false but is R correct (A गलत है

लेकिन R गलत है) लेकिन R सही है)

Solution Hide
Correct Answer: A
Private sector companies' bonds usually offer a higher interest rate compared to government
securities and Private sector bonds carry a greater risk than government-backed securities

Question 42
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If the selling price of a bond decreases in the secondary market. then its bond yield will _ _ _
_.(द्वितीयक बाज़ार में यदि बोंड की बिक्री-क़ीमत में गिरावट आती है तो बॉन्ड की यील्ड _ _ _ होगी।)

increase (बढ़े गी)

decrease (कम होगी)

cannot be determined (निर्धारित नहीं

remain unchanged (यथास्थिति रहेगी)
किया जा सकता है)

Solution Hide
Correct Answer: B
When the price of a bond increases, the bond yield falls. When the price of a bond decreases,
the bond yield rises

Question 43
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Which of the following statement/s are correct:- (निम्नलिखित में से कौन सा / से कथन सही है)
1. If RBI lowers the loan to value ratio from 80% to 40% it can help combating the
inflation. (यदि आरबीआई मात्रात्मक ऋण के अनुपात को 80% से 40% तक कम करता है तो यह
मुद्रास्फीति को कम करने में मदद कर सकता है)
2. If Government borrows large amount of money from RBI it may lead to inflation in the
economy. (अगर सरकार आरबीआई से बड़ी रकम उधार लेती है तो इससे अर्थव्यवस्था में महंगाई बढ़
सकती है)

Only 1 (के वल 1) Only 2 (के वल 2)

1 & 2 both (1 और 2 दोनों)

None of the above (इनमे से कोई नहीं)

Solution Hide
Correct Answer: C
st1 is right: If the LTV is below 80% for loans of Rs.30 lakh, the risk weight falls to 35%. If RBI
lowers the loan-to-value ratio from 80% to 40% it can help combat inflation.
st2 is right: If the government resorts to larger borrowings, more than what it has projected,
then its interest costs also go up risking a higher fiscal deficit and leading to inflation in the
economy.

Question 44
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If Reserve Bank of India had sold Rs 25000 crore worth of Government securities under
Open Market Operations (OMOs). Which of the following best describes the primary
motive(s) behind this decision of RBI? (यदि भारतीय रिज़र्व बैंक ने खुले बाज़ार की क्रियाओं (ओएमओ)

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के अन्तर्गत सरकारी प्रतिभूतियों की 25000 करोड़ रुपये की बिक्री की थी। निम्नलिखित में से कौन RBI के
इस निर्णय के पीछे प्राथमिक उद्देश्य (यों) का वर्णन करता है)
1. RBI wants to increase money supply in the system.(भारतीय रिज़र्व बैंक अर्थव्यवस्था में धन की
आपूर्ति बढ़ाना चाहता है)
2. RBI wants the banks to lend money to the priority sectors of the economy. (भारतीय रिज़र्व
बैंक चाहता है कि बैंकअर्थव्यवस्था के प्राथमिकत क्षेत्रों को पैसा उधार दें)
3. RBI wants to pursue tight monetary policy. (आरबीआई तंग मौद्रिक नीति को आगे बढ़ाना चाहता है)

Only 1 (के वल 1) Only 1 and 2 (के वल 1 और 2)

Only 3 (के वल 3)
Only 2 and 3 (के वल 2 और 3)

Solution Hide
Correct Answer: D
Tight monetary policy can be implemented via selling Government securities to the market
through open market operations (OMO) to reduce money supply. So only ST3 is right.

Question 45
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To boost the demand in corona pandemic 2020 which of the following step(s) were taken by
Reserve Bank of India? (कोरोना महामारी में मांग को बढ़ावा देने के लिए भारतीय रिज़र्व बैंक ने
निम्नलिखित में से कौन सा कदम उठाये थे?)
1. Loan to value ratio was decreased (ऋण अनुपात मूल्य घटाया गया था)
2. Repo rate was decreased (रे पो दर कम किया गया था)
3. Cash reserve ratio was decreased (नकद आरक्षित अनुपात घटाया गया था)

Only 2 and 3 (के वल 2 और 3)

Only 1 and 2 (के वल 1 और 2)

Only 1 and 3 (के वल 1 और 3) All three statements (सभी तीन कथन)

Solution Hide
Correct Answer: B
LTV was increased. Repo was Decreased. CRR was decreased. So only 2 and 3 are right

Question 46
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Find correct statements about Priority Sector Lending (PSL) norms in India: (भारत में
प्राथमिकता उधार क्षेत्र के मानदंडों के बारे में सही कथन ज्ञात करें )
1. Only one person per household is eligible for loans under PSL quota. (पीएसएल कोटा के
अन्तर्गत हर घर से के वल एक व्यक्ति ऋण का पात्र है)
2. 3% PSL quota is earmarked for environmental conservation projects.(पर्यावरण संरक्षण
परियोजनाओं के लिए 3% पीएसएल का कोटा निर्धारित किया गया है)

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3. Foreign banks in India are not required to abide with PSL norms. (भारत में विदेशी बैंकों को
पीएसएल मानदंडों का अनुपालन करना अनिवार्य नहीं है)

Only 1 and 2 (के वल 1 और 2) Only 2 and 3 (के वल 2 और 3)

None of them (इनमें से कोई नहीं)

Only 1 and 3 (के वल 1 और 3)

Solution Hide
Correct Answer: D
st1 is wrong: The household is eligible for loans under the PSL quota. For individual
households, the loan limit will be Rs10 lakh per borrower.
st2 is wrong: RBI guidelines for PSL for scheduled commercial banks: 40% of the total net
bank credit should go to priority sector advances.
st3 is wrong: Commercial banks, including foreign banks, are required to mandatorily
earmark 40% loans to PSL

Question 47
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Which of the following statement/s are correct regarding Monetary Policy Committee:-
(मौद्रिक नीति समिति के बारे में निम्नलिखित में से कौन सा कथन सही है)
1. This committee is formed under the Banking Regulation Act.(यह समिति बैंकिं ग विनियमन
अधिनियम के तहत बनाई गई है)
2. Legally they are required to meet minimum 12 times a year.(कानूनी तौर पर उन्हें वर्ष में न्यूनतम
12 बार मिलना आवश्यक है)
3. Inflation target for the next five years till 31/3/2026 is 3% to 6% CPI (All India). (अगले पांच
वर्षों के लिए 31/3/2026 तक मुद्रास्फीति लक्ष्य सीपीआई का 3% से 6% है)

Only 1 & 2 (के वल 1 और 2) Only 2 and 3 (के वल 2 और 3)

None of the statements are correct

Only 3 (के वल 3) (कोई भी कथन सही नहीं है)

Solution Hide
Correct Answer: D
st 1 is wrong: The monetary Policy Committee (MPC) was constituted as per Section 45ZB
under the RBI Act of 1934 by the Central Government.
st 2 is wrong: The MPC is required to meet at least four times a year.
st 3 is wrong:The inflation target for the period April 1, 2021, to March 31, 2026, under the
Reserve Bank of India Act 1934 has been kept at the same level as was for the previous 5
years, i.e., 4 per cent (with the upper tolerance level of 6 per cent and the lower tolerance
level of 2 per cent)

Question 48
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If RBI adopts a Calibrated Tightening Stance in its monetary policy what does it mean
theoretically? (यदि भारतीय रिज़र्व बैंक अपनी सख्त मौद्रिक नीति के माध्यम से अर्थव्यवस्था को व्यवस्थित
करने का रुख अपनाता है तो इसका क्या अर्थ है)
1. RBI may keep the repo rate unchanged.(भारतीय रिज़र्व बैंक रे पो दर को अपरिवर्तित रख सकता है)
2. RBI may hike the repo rate. (भारतीय रिज़र्व बैंक रे पो रे ट में बढ़ोतरी कर सकता है)

Only 1 (के वल 1) Only 2 (के वल 2)

Both 1 and 2 (1 और 2 दोनों)

None of the above (इनमें से कोई नहीं)
CORRECT ANSWER

Solution Hide
Correct Answer: C
st 1 and 2 are right: Calibrated tightening means during the current rate cycle, a cut in the
repo rate is off the table. But the rate hike will happen in a calibrated manner.

Question 49
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____ is not included in the assets of a commercial bank in India? (भारत में किसी वाणिज्यिक बैंक
की परिसंपत्ति में निम्नलिखित में से क्या शामिल नहीं है?) (Prelims-2019)

Deposits (जमा)
Advances (अग्रिम)

Money at call and short notice (माँग

Investments (निवेश) तथा अल्प सूचना मुद्रा -मनी ऐट कॉल ऍड
शॉर्ट नोटिस)

Solution Hide
Option (b) is correct: Deposits are not included in the assets of a commercial bank in India.
Deposits are liabilities of a commercial bank. Deposits are like debt in that it is money that
the banks owe to the customer but they differ from debt in that the addition or withdrawal of
money is at the discretion of the depositor rather than dictated by contract.

Question 50
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Open Market Operations' refers to: (मुक्त बाज़ार परिचालन से तात्पर्य है) (Prelims-2013)

lending by commercial banks to

borrowing by banks from the RBI
industry and trade (उद्योग और व्यापार
(बैंकों द्वारा आरबीआई से उधार लेना)
के लिए वाणिज्यिक बैंकों द्वारा ऋण)

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purchase and sale of government None of the above (उपरोक्त में से कोई
securities by the RBI (भारतीय रिजर्व बैंक भी नहीं)
द्वारा सरकारी प्रतिभूतियों की खरीद और
बिक्री)

Solution Hide
Option (c) is correct: Open Market Operation (OMO) is a monetary policy framework of the
Reserve Bank of India (RBI), which influences the volume of money in an economy. It refers to
the buying and selling of government securities in the open market (Open market means
banks and financial institutions) in order to expand or contract the supply of money in the
market.

Question 51
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Net interest margin (NIM) is a term used for _ _ _ (शुद्ध ब्याज मार्जिन (NIM) एक शब्द है जिसका
उपयोग _ _ _ के लिए किया जाता है)

difference between repo rate and difference between CRR rate and
MSF rate (रे पो रे ट और एमएसएफ रे ट के SLR rate (सीआरआर दर और एसएलआर
बीच अंतर) दर के बीच अंतर)

difference between bank’s lending

difference between bank rate and
rate and deposit rate (बैंक की उधार दर
repo rate (बैंक दर और रे पो रे ट के बीच
औरजमादरके बीचअं तर)
अंतर।)

Solution Hide
Correct Answer: C
Net interest margin (NIM) is a term used for finding the profitability of a financial institution's
loan-deposit activities. So out of the given options the difference between bank’s lending rate
and deposit rate is most appropriate.
Therefore, the answer is C.

Question 52
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Liquidity overhang problem occurs when _ _ _ (तरलता ओवरहैंग समस्या तब होती है जब _ _ _)

When the Central bank of a country

Supply of money is less than the
stops giving loans to the banks (जब
demand of money (मुद्रा की आपूर्ति मुद्रा
किसी देश का कें द्रीय बैंक बैंकों को ऋण देना
की मांग से कम है।)
बंद कर देता है।)

When there is a sudden rush among

Supply of money exceeds the
panicked depositors to withdraw
demand of money (धन की आपूर्ति धन
money from the bank (जब भय की
की मांग से अधिक होती है।)

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स्थिति में जमाकर्ताओं के बीच बैंक से पैसे
निकालने की अचानक होड़ मच गई।)

Solution Hide
Correct Answer: C
Explanation: The liquidity overhang problem occurs when there is an excess of liquidity or
cash in the financial system but not enough demand for loans.
Therefore, the answer is C.

Question 53
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How many of the following statements are correct with regards to incremental-CRR (I-CRR)?
(वृद्धिशील-सीआरआर (I-CRR) के संबंध में, निम्नलिखित में से कितने कथन सही है/हैं?)
1. RBI has imposed this to punish the bankers with huge quantities of bad loans (NPA).
(आरबीआई ने भारी मात्रा में फं से कर्ज (एनपीए) वाले बैंकरों को दंडित करने के लिए इसे लगाया है।)
2. Bankers are required to keep I-CRR on a temporary basis in 2023.(बैंकरों को 2023 में I-CRR
को अस्थायी आधार पर रखना आवश्यक है।)
3. Public Sector Banks are exempted from I-CRR. (सार्वजनिक क्षेत्र के बैंकों को I-CRR से छू ट दी गई
है.)
Answer Codes (उत्तर हेतु कू ट:)

only one of these (इनमें से के वल एक)

only two of these (इनमें से के वल दो)

only three of these (इनमें से के वल तीन) None of these (इनमें से कोई नहीं)

Solution Hide
Correct Answer: A (only one of them is right).
Explanation: 10% I-CRR was a temporary measure to address liquidity overhang problem in
the aftermath of withdrawal of the Rs.2000 notes. So only st2 is right. Remaining statements
are wrong. Therefore, the answer is A.

Question 54
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Consider the following statements about the I-CRR.(I-CRR के बारे में निम्नलिखित कथनों पर विचार
कीजिए:)
Statement1: Bankers were required to keep 4.5% I-CRR on a temporary basis in 2023.
(कथन I: बैंकरों को 2023 में अस्थायी आधार पर 4.5% I-CRR रखने की आवश्यकता थी।)
Statement2: Withdrawal of Rs.2000 note in 2023 was likely to cause a problem of
liquidity overhang. (कथन II: 2023 में 2000 रुपये के नोट को वापस लेने से तरलता की समस्या पैदा
होने की संभावना थी।)
Answer Codes: (उत्तर हेतु कू ट:)

Both I & II are correct & II is the Both I & II are correct & II is not the
correct explanation for I (I और II दोनों correct explanation for I (I और II दोनों
सही हैं और II, I की सही व्याख्या है) सही हैं और II, I की सही व्याख्या नहीं है)

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I is wrong but II is correct (I सही नहीं है

I is correct but II is wrong (I सही है
लेकिन II सही है)
लेकिन II सही नहीं है)

Solution Hide
Correct Answer: (d)
St2 is right. But st1 is wrong because I-CRR is 10% and not 4.5%
Therefore, the answer is (d).

Question 55
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An ideal repo rate rate that helps in economic growth, low inflation, and full employment in
the economy is called _ _ _ (एक आदर्श रे पो रे ट जो आर्थिक विकास, कम मुद्रास्फीति और अर्थव्यवस्था
में पूर्ण रोजगार में मदद करती है उसे _ _ _ कहा जाता है)
Find Correct statement(s):(सही कथन चुनिए:)
1. Terminal repo rate(टर्मिनल रे पो रे ट)
2. neutral repo rate(तटस्थ रे पो रे ट)
Answer Codes: (उत्तर हेतु कू ट:)

only 1 (के वल 1) only 2 (के वल 2)

both 1 and 2 (1 और 2 दोनों)

neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide
Correct Answer: C both right.
Explanation: A "neutral repo rate," also known as a "terminal repo rate," refers to the
equilibrium or long-term interest rate level that a central bank or monetary authority aims to
achieve as part of its monetary policy framework. This rate is typically considered to be
consistent with stable economic growth, low inflation, and full employment in the economy.
Therefore, the answer is C.

Question 56
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How many of the following terms are associated with short term loans?(निम्नलिखित में से कितने
शब्द अल्पावधि ऋण से संबंधित हैं?)
1. Call Money (कॉल मनी)
2. Notice Money (नोटिस मनी)
3. Term Money (टर्म मनी)
4. Reserve Money (आरक्षित धन)
Answer Codes (उत्तर हेतु कू ट:)

only one of these (इनमें से के वल एक) only two of these इनमें से के वल दो)

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only three of these (इनमें से के वल तीन) All four of these (ये चारों)

Solution Hide
Correct Answer: C only three of these
Explanation: Reserve money, also known as the monetary base or high-powered money is
M0. So it is wrong. Other options call/notice/term are right.
Therefore, the answer is C.

Question 57
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number of times a unit of money changes hand during a year is called _ _ _ (एक वर्ष के दौरान
मुद्रा की एक इकाई के एक व्यक्ति/स्थान से दू सरे व्यक्ति/स्थान में जाने की संख्या को क्या कहा जाता है?)

speculation of money (धन की

transaction of money (धन का लेन-देन)
अटकलबाजी/परिकल्पन)

velocity of money (धन का संचलन वेग)

creation of money (धन का सृजन)

Solution Hide
Correct Answer: C
Explanation: Velocity of money is a concept in economics that represents the rate at which
money changes hands within an economy over a specific period of time.
Therefore, the answer is C.

Question 58
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Total demand for money in an economy is composed of _ _ _ (किसी अर्थव्यवस्था में धन की कु ल

मांग _ _ _ से बनी होती है)
Find Correct statement(s): (सही कथन चुनिए:)
1. transaction demand (लेन-देन की मांग)
2. speculative demand (सट्टा/परिकल्पी मांग)
Answer Codes: (उत्तर हेतु कू ट:)

only 1 (के वल 1) only 2 (के वल 2)

both 1 and 2 (1 और 2 दोनों)

neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide

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Correct Answer: C both of these.
Explanation: total demand = transaction demand + speculative demand.
Therefore, the answer is C.

Question 59
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Find correct statements about the Transaction demand of money. (धन के लेनदेन की मांग के बारे
में सही कथन चुनिए:)
1. it is directly proportional to GDP (यह सकल घरे लू उत्पाद से सीधे आनुपातिक होती है।)
2. it is inversely proportional to inflation. (यह मुद्रास्फीति के व्युत्क्रमानुपाती होती है।)
Answer Codes: (उत्तर हेतु कू ट:)

only 1 (के वल 1)
only 2 (के वल 2)

both 1 and 2 (1 और 2 दोनों) neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide
Correct Answer: A only 1
Explanation: st1 right. transaction demand directly proportional to GDP
St2 wrong. it is directly proportional to inflation and NOT inversely proportional.
Therefore, the answer is A .

Question 60
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How many of the following indicators are used in the formula for calculating System level
liquidity? (प्रणाली स्तरीय तरलता की गणना हेतु सूत्र में निम्नलिखित में से कितने संके तक का उपयोग किया
जाता हैं?)
1. Repo (रे पो)
2. SLR (एसएलआर)
3. MSF (एमएसएफ)
4. SDF (एसडीएफ)
5. CRR (सीआरआर)
Answer Codes (उत्तर हेतु कू ट:)

only three of these (इनमें से के वल तीन)

only two of these (इनमें से के वल दो)

only four of these (इनमें से के वल चार) all five of these (ये सभी पांच)

Solution Hide
Correct Answer: B
Explanation:
System level liquidity = [(Reverse repos +SDF) – (Repo + MSF)].
So SLR and CRR not counted in it.

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Therefore, the answer is - B) only three of these

Question 61
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How many of the following are correct about the Green deposits in India? (भारत में ग्रीन
डिपॉजिट के बारे में, निम्नलिखित में से कितने कथन सही है/हैं?)
1. Housing Finance companies can accept green deposits. (हाउसिंग फाइनेंस कं पनियां ग्रीन
डिपॉजिट स्वीकार कर सकती हैं।)
2. Bankers can loan the money from green deposits to nuclear energy projects. (बैंकर ग्रीन
डिपॉजिट से परमाणु ऊर्जा परियोजनाओं हेतु धन उधार ले सकते हैं।)
3. In case a bank shuts down, the green depositor’s will get refund from Indian Renewable
Energy Development Agency (IREDA) (यदि कोई बैंक बंद हो जाता है, तो ग्रीन डिपॉजिटर को भारतीय
नवीकरणीय ऊर्जा विकास एजेंसी (IREDA) से रिफं ड मिलेगा।)
4. Bank have to keep only 1% CRR on the green deposits. (बैंक को ग्रीन डिपॉजिट पर सिर्फ 1%
CRR रखना होगा।)
Answer Codes (उत्तर हेतु कू ट)

only one of these (इनमें से के वल एक)

only two of these (इनमें से के वल दो)

only three of these (इनमें से के वल तीन) All four of these (सभी चार)

Solution Hide
Correct Answer: A
Explanation:
St1 right. Banks, deposit-taking NBFCs (e.g. Bajaj Finserv), Housing Finance companies
(e.g. Canfin Homes)- can collect such deposits
St2 wrong. not allowed in fossil fuels, nuclear power^^, tobacco, etc business.
St3 wrong. DICGC gives protection. NOT IREDA
St4 wrong. The normal 4.5% CRR applies.
Therefore, the answer is A.

Question 62
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What is the correct formula for system level liquidity? (प्रणाली स्तरीय तरलता का सही सूत्र क्या है?)

[(Repo + Reverse Repo)-(MSF+SDF)]. [(Repo + MSF)-(Reverse repos +SDF)].

[((रे पो + रिवर्स रे पो)- ([(रे पो + एमएसएफ)-(रिवर्स रे पो
(एमएसएफ+एसडीएफ)]।) +एसडीएफ)]।)

[(Reverse repos +SDF) – (Repo +

[(Reverse repos-SDF) + (Repo - MSF)].
MSF)]. ([(रिवर्स रे पो +एसडीएफ) - (रे पो +
([(रिवर्स रे पो-एसडीएफ) + (रे पो -
एमएसएफ)]।)
एमएसएफ)]।)

Solution Hide

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Correct Answer: C
Explanation:
System level liquidity = [(Reverse repos +SDF) – (Repo + MSF)].
Therefore, the answer is C.

Question 63
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Under which of the following banking system a banker will loan the demand deposits to
borrowers? (निम्नलिखित में से किस बैंकिं ग प्रणाली के तहत एक बैंकर उधारकर्ताओं को मांग जमा पर ऋण
देगा?)
1. Full Reserve Banking (पूर्ण रिजर्व बैंकिं ग)
2. Fractional Reserve Banking (भिन्न प्रारक्षण बैंकिं ग प्रणाली)
Answer Codes: (उत्तर हेतु कू ट)

only 2 (के वल 2)
only 1 (के वल 1)

both 1 and 2 (1 और 2 दोनों) neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide
Correct Answer: B
Explanation:
Demand deposits given as loan under the fractional reserve banking, but not under the full
reserve banking.
Therefore, the answer is B.

Question 64
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Consider following statements: (निम्नलिखित कथनों पर विचार कीजिये)

Statement1: fractional reserve banking system allows a banker to play more catalytic
role in the economic growth of a country. (कथन 1: भिन्न प्रारक्षण बैंकिं ग प्रणाली एक बैंकर को
किसी देश की आर्थिक वृद्धि में अधिक उत्प्रेरक भूमिका निभाने की अनुमति देती है।)
Statement2: Under the fractional reserve banking system a central bank exempts
bankers from CRR and SLR requirements. (कथन 2: भिन्न प्रारक्षण बैंकिं ग प्रणाली के तहत एक
कें द्रीय बैंक बैंकरों को CRR और SLR आवश्यकताओं से छू ट देता है।)
Answer Codes: (उत्तर हेतु कू ट)

Both I & II are correct & II is the Both I & II are correct & II is not the
correct explanation for 1 (I और II दोनों correct explanation for 1 (I और II दोनों
सही हैं और II, 1 का सही स्पष्टीकरण है) सही हैं और II, 1 का सही स्पष्टीकरण नहीं है)

I is correct but II is wrong (I सही है

I is wrong but II is correct (I सही नही है
लेकिन II सही नही है)
लेकिन II सही है)

Solution Hide

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Correct Answer: C
Explanation: st2 wrong. Fractional reserve banking is related to banker can give both time
deposit and demand deposit as loans. It has noting to do with CRR/SLR. So st2 wrong. By
elimination answer is C.
Therefore, the answer is C.

Question 65
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Which of the following action may result into monetisation of the deficit by the central
bank? (निम्नलिखित में से किस कार्र वाई के परिणामस्वरूप कें द्रीय बैंक द्वारा घाटे का मुद्रीकरण किया जा
सकता है?)
1. when central bank purchases government securities from the secondary market. (जब
कें द्रीय बैंक द्वितीयक बाज़ार से सरकारी प्रतिभूतियाँ खरीदता है।)
2. when central bank sells government securities to other bankers & investors in the
primary market. (जब कें द्रीय बैंक प्राथमिक बाजार में अन्य बैंकरों और निवेशकों को सरकारी प्रतिभूतियां
बेचता है।)
Answer Codes: (उत्तर हेतु कू ट)

only 1 (के वल 1) only 2 (के वल 2)

neither 1 nor 2 (न तो 1, न ही 2)
both 1 and 2 (1 और 2 दोनों)

Solution Hide
Correct Answer: D
Explanation:
Monetisation of deficit = when central bank is printing currency notes in the air/recklessly, just
to help the government to fill up its deficit.
St1 not related. Bcoz in the secondary market, Govt (original borrower) will not get the money.
St2 not related. Because other bankers are paying the money, and not RBI.

Question 66
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Which of the following act prohibits RBI from purchasing government security from the
primary market in the normal circumstances? (निम्नलिखित में से कौन-सा अधिनियम आरबीआई को
सामान्य परिस्थितियों में प्राथमिक बाजार से सरकारी प्रतिभूति क्रय करने से रोकता है?)

Government securities regulation act,

RBI Act 1934 (RBI अधिनियम 1934) 1957 (सरकारी प्रतिभूति विनियमन
अधिनियम, 1957)

Fiscal responsibility and Budget

management act, 2003 (राजकोषीय
Negotiable instrument act, 1967
उत्तरदायित्व और बजट प्रबंधन अधिनियम,
(परक्राम्य लिखत अधिनियम, 1967)
2003)

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Solution Hide
Correct Answer: C
Explanation: FRBM act forbids it.
Therefore, the answer is C.

Question 67
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in 2023, RBI permitted “reset” of the bank loans in context of which of the following
challenge? (2023 में, RBI ने निम्नलिखित में से किस चुनौती के संदर्भ में बैंक ऋणों के "रीसेट" की अनुमति
दी?)

Some borrowers had to pay very

Some borrowers were unable to high interest rate because of the
repay the loan due to loss of job or external benchmark loans. (कु छ
business in Corona. (कोरोना में रोजगार उधारकर्ताओं को बाहरी बेंचमार्क ऋणों के
या बिजनेस में हानि के कारण कु छ उधारकर्ता कारण बहुत अधिक ब्याज दर का भुगतान
ऋण नहीं चुका पा रहे थे) करना पड़ता था।)

Alleged banking scams in PMC Bank,

Agrarian crisis in the aftermath of
Yes Bank and PayTM Bank (PMC बैंक,
bad monsoon. (खराब मानसून के बाद
यस बैंक और PayTM बैंक में कथित बैंकिं ग
कृ षि संकट।)
घोटाले)

Solution Hide
Correct Answer: B
Explanation:
Reset to help borrowers who had to pay very high interest rate because of the external
benchmark loans.
Therefore, the answer is B.

Question 68
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Consider following statements: (निम्नलिखित कथनों पर विचार कीजिए:)

Statement1: the speculative demand of money becomes infinite when economy is
suffering from a problem of liquidity trap. (कथन I: जब अर्थव्यवस्था तरलता जाल की समस्या से
पीड़ित होती है तो धन की सट्टा मांग अनंत हो जाती है।)
Statement2: Banks offer very attractive savings interest rates on deposit account during
liquidity trap. (- कथन II: बैंक तरलता जाल के दौरान जमा खाते पर बहुत आकर्षक बचत ब्याज दरें प्रदान
करते हैं।)
Answer Codes: (उत्तर हेतु कू ट)

Both I & II are correct & II is the Both I & II are correct & II is not the
correct explanation for 1 (I और II दोनों correct explanation for 1 (I और II दोनों
सही हैं और II,I की सही व्याख्या है) सही हैं और II I की सही व्याख्या नहीं है)

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I is correct but II is wrong (I सही है

I is wrong but II is correct (I सही नहीं है
ले िकन II सहीनहीं है )
लेकिन II सही है)

Solution Hide
Correct Answer: C
Explanation:
St2 wrong. Bankers give very low interest on savings during liquidity trap. So by elimination
answer is C
Therefore, the answer is C.

Question 69
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Find correct about the UDGAM Portal (उद्गम पोर्टल के बारे में सही खोजें)
1. It is operated by NPCi (इसे एनपीसीआई द्वारा क्रियान्वित किया गया है)
2. This portal helps victims to file complaints against UPI frauds (यह पोर्टल पीड़ितों को यूपीआई
धोखाधड़ी के खिलाफ शिकायत दर्ज करने में मदद करता है)
Answer Codes:

only 1 (के वल 1) only 2 (के वल 2)

neither 1 nor 2 (न तो 1, न ही 2)
both 1 and 2 (1 और 2 दोनों )

Solution Hide
Correct Answer: D
Explanation: Launched by RBI to deal with unclaimed deposits. So both statements are
wrong.
Therefore, the answer is D.

Question 70
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According to the economic survey, if banks have a net interest margin (NIM) of more than _
_ _ % then it is considered dangerous for financial stability.(आर्थिक सर्वेक्षण के अनुसार, यदि
बैंकों का शुद्ध ब्याज मार्जिन (NIM) _ _ _% से अधिक है तो इसे वित्तीय स्थिरता के लिए खतरनाक माना
जाता है।)

3% 4%

5%
None of the above

Solution Hide

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Correct Answer: C
Explanation: If NIM>5%, it implies that greedy-bankers are exploiting the depositor and/or
the borrower. This is not good for the financial stability of the system.
Therefore, the answer is C.

Question 71
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Consider following three statements:(निम्नलिखित तीन कथनों पर विचार कीजिए:)

Statement-I: Money Multiplier has improved for India for the financial year 2023-24.
(कथन-I: वित्तीय वर्ष 2023-24 के लिए भारत के लिए मनी मल्टीप्लायर में सुधार हुआ है।)
Statement-II: HDFC (NBFC) was merged with HDFC in the year 2023.(कथन-II: एचडीएफसी
(एनबीएफसी) का वर्ष 2023 में एचडीएफसी में विलय कर दिया गया था।)
Statement-III: RBI had withdrawn ₹2000 note in 2023.(कथन-III: आरबीआई ने 2023 में ₹2000
के नोट वापस ले लिए थे।)
Which one of the following is correct in respect of the above statements?

Both Statement-II and Statement-III

Both Statement-II and Statement-III
are correct and both of them explain
are correct, but only one of them
Statement-I (कथन-II और कथन-III दोनों
explains Statement-I (कथन-II और
सही हैं और दोनों कथन-I की व्याख्या करते
कथन-III दोनों सही हैं, लेकिन उनमें से के वल
हैं।)
एक ही कथन-I की व्याख्या करता है।)

Only one of the Statement-II and III

is correct and that explain Neither Statement-II nor Statement -
Statement- I III is correct.
(कथन-II और III में से के वल एक ही सही है (न तो कथन-II , न ही कथन-III सही है।
और वह कथन-I को स्पष्ट करता है।

Solution Hide
Correct Answer: A
Explanation: As per Economic Survey 2023-24 MM (Money Multiplier) improved from 5.2
(2023-March) to 5.4 (2024-March), due to following factors:
Withdrawal of ₹2,000 banknote
Merger of HDFC (non-banking financial company/NBFC) with HDFC Bank. (because such
merger of two healthy units improves the organisational efficiency in attracting more clients
for deposit and lending activities, thereby improving the money multiplier effect.)
Bankers increased the interest on deposits = more depositors attracted.
Therefore, the answer is (a) Both Statement-II and Statement-III are correct and both of them
explain Statement-I.

Question 72
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Which of the following factors can lead to an increase in the size of high powered money
(M0)?
(निम्नलिखित में से कौन सा कारक उच्च शक्तिशाली मुद्रा (M0) के आकार में वृद्धि का कारण बन सकता है?)
1. A decrease in CRR.(CRR में कमी)
2. An increase in the net foreign assets (NFA)(शुद्ध विदेशी परिसंपत्तियों (NFA) में वृद्धि)
Select the correct answer using the code given below:
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2 only (के वल 2)
1 only (के वल 1)

Both 1 and 2 (1 और 2 दोनों) Neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide
Correct Answer: B
Explanation: As per Economic Surveys:
Statement 1 is not correct: CRR needs to increase then M0 will increase.
Statement 2 is correct: NFA increase results in M0 increase.
Therefore, the answer is B.

Question 73
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What is bulk deposit? (थोक जमा क्या है?)

When the government transfers

When a bank makes fixed deposits
money into the bank account of
for a group of persons. (जब कोई बैंक
thousands of beneficiaries. (जब
व्यक्तियों के एक समूह के लिए सावधि जमा
सरकार हजारों लाभार्थियों के बैंक खाते में धन
करता है।)
हस्तांतरित करती है।)

A fixed deposit bigger than three

crore rupees in a Scheduled
Commercial Bank.(किसी अनुसूचित There is no such concept. (ऐसी कोई
वाणिज्यिक बैंक में तीन करोड़ रुपये से अवधारणा नहीं है।)
अधिक की सावधि जमा।)

Solution Hide
Correct Answer: C
Explanation: Bulk Deposit means a large sized fixed deposit of ₹3cr or higher.
Therefore, the answer is C.

Question 74
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How many of the following outcomes will occur during a liquidity trap situation?(तरलता जाल
की स्थिति के दौरान निम्नलिखित में से कितने परिणाम घटित होंगे?)
Speculative demand for money will become ZERO.(मुद्रा की सट्टा मांग शून्य हो जाएगी।)
1. Loan interest rates will remain stagnant despite an increase in the money supply. (मुद्रा की
आपूर्ति में वृद्धि के बावजूद ऋण ब्याज दरें स्थिर रहेंगी।
2. There will be a great inflow of deposits in the banks.(बैंकों में जमा राशि का प्रवाह बहुत अधिक
होगा।)

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3. There will be an increase in the number of loan applications.(ऋण आवेदनों की संख्या में वृद्धि
होगी।)
Select the correct answer using the code given below:

Only one (के वल एक)

Only two (के वल दो)

Only three (के वल तीन) All four (सभी चार)

Solution Hide
Correct Answer: A
Explanation:
Statement 1 is not correct: Speculative demand for money will become infinite.
Statement 2 is correct: Increased money supply will not decrease the loan interest rates.
Statement 3 is not correct: Bankers will stop offering good deposit interest rates, and there
will be an outflow of the deposits and not inflow.
Statement 4 is not correct: There will be a decrease in the loan applications because people
have lost job and business opportunities on account of economic creation during a liquidity
trap situation.
Therefore, the answer is (A) only one of these is correct.

​
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Question 75
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Which of the following acts as leakages to the money multiplier? (MCQ. निम्नलिखित में से कौन
सा धन/मुद्रा गुणक (मनी मल्टीप्लायर) में लिके ज के रूप में कार्य करता है? )
1. Withdrawal of cash from bank deposits. (बैंक जमा से नकदी की निकासी।)
2. Increase in the cash reserve ratio. (नकद आरक्षित अनुपात में वृद्धि।)
Select the correct answer using the codes given below: (नीचे दिए गए कू ट का उपयोग करके सही
उत्तर चुनिए)

1 only (के वल 1) 2 only (के वल 2)

Both 1 and 2 (1 और 2 दोनों)

Neither 1 nor 2 (न तो 1, न ही 2)

Solution Hide
Correct Answer: C
Explanation:
Statement 1 is correct: Withdrawal of cash from bank deposits: When individuals withdraw
cash from their bank accounts, it reduces the amount of money available in the banking
system for lending. This leakage decreases the potential for credit creation and lowers the
money multiplier
Statement 2 is correct: Increase in the cash reserve ratio (CRR): An increase in CRR requires
banks to hold a higher proportion of their deposits as reserves with the central bank. This
reduces the funds available for lending, thereby decreasing the money multiplier
Both factors act as leakages to the money multiplier, reducing its effectiveness in expanding
the money supply.

Therefore, the answer is C.

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