Bank Theory

MCQs on Theories of Interest 1. According to Classical Theory, the rate of interest is determined by: a) Supply and demand for money b) Central bank policies c) Supply of savings and demand for investment d) Marginal efficiency of capital 2. Keynes’ Liquidity Preference Theory states that people demand money for: a) Only precautionary motives b) Transaction, precautionary, and speculative motives c) Consumption only d) Investment purposes only 3. In Keynesian theory, the rate of interest is determined by: a) Investment demand b) National income c) Supply and demand for money d) Government expenditure 4. What does the money demand curve show? a) Inverse relationship between interest rate and quantity of money demanded b) Direct relationship between interest rate and demand c) Government demand for money d) Investment trends 5. The equilibrium rate of intere...

MCQs on Money, Money Supply, and Inflation 1. What is the primary function of money? a) To create employment b) To measure temperature c) To act as a medium of exchange d) To increase inflation a) Currency with the public b) Gold reserves in temples c) Demand deposits with banks d) Time deposits 3. Which authority is responsible for regulating money supply in India? a) Ministry of Finance b) Reserve Bank of India (RBI) c) SEBI d) NITI Aayog 4. Inflation refers to: a) Increase in employment b) Decrease in prices c) General rise in prices over time d) Decrease in money supply 5. Demand-pull inflation occurs when: a) Demand exceeds supply b) Supply exceeds demand c) Prices fall rapidly d) Currency is withdrawn 6. Which of the following can cause cost-push inflation? a) Increase in productivity b) D...

MCQs on Fundamentals of Economics, Microeconomics, Macroeconomics and Types of Economies 1. What is the primary concern of economics? a) Production of goods only b) Unlimited wants and limited resources c) Distribution of wealth only d) Government budgeting Answer: b) 2. Which of the following is studied in Microeconomics? a) National Income b) Inflation c) Price determination in individual markets d) Government expenditure Answer: c) 3. Macroeconomics is concerned with: a) Behavior of individual consumers b) Study of a single firm's cost c) National income and employment d) Pricing of a commodity Answer: c) 4. In which type of economy are all economic decisions taken by the government? a) Market Economy b) Command Economy c) Mixed Economy d) Traditional Economy Answer: b) ...