IASbaba's Daily Static Quiz
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DAILY STATIC QUIZ will cover all the topics of Static/Core subjects – Polity, History, Geography, Economics, Environment and Science and technology.
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UPSC Static Quiz - 2020 : IASbaba's Daily Static Quiz - ECONOMY [Day 15]
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Question 1 of 10
1. Question
Consider the following statements
- Banking Regulation Act, 1949, empowers NABARD to conduct inspection of State Cooperative Banks (StCBs).
- NABARD has been accredited as National Implementing Entity (NIE) for Adaptation Fund of United Nations Framework Convention on Climate Change (UNFCCC).
Which of the statements given above is/are NOT correct?
Correct
Solution (d)
Section 35(6) of the Banking Regulation Act, 1949, empowers NABARD to conduct inspection of State Cooperative Banks (StCBs), District Central Cooperative Banks (DCCBs) and Regional Rural Banks (RRBs).
Hence Statement 1 is correct.
NABARD has been accredited as Direct Access Entity (DAE) of Green Climate Fund for channelizing resources under this Fund. NABARD aims to use the use the GCF resources for projects and programmes aimed at climate resilient and low emission development.
NABARD has also been accredited as National Implementing Entity (NIE) for Adaptation Fund of United Nations Framework Convention on Climate Change (UNFCCC) as well designated as NIE for National Adaptation Fund for Climate Change.
Hence Statement 2 is correct.
Incorrect
Solution (d)
Section 35(6) of the Banking Regulation Act, 1949, empowers NABARD to conduct inspection of State Cooperative Banks (StCBs), District Central Cooperative Banks (DCCBs) and Regional Rural Banks (RRBs).
Hence Statement 1 is correct.
NABARD has been accredited as Direct Access Entity (DAE) of Green Climate Fund for channelizing resources under this Fund. NABARD aims to use the use the GCF resources for projects and programmes aimed at climate resilient and low emission development.
NABARD has also been accredited as National Implementing Entity (NIE) for Adaptation Fund of United Nations Framework Convention on Climate Change (UNFCCC) as well designated as NIE for National Adaptation Fund for Climate Change.
Hence Statement 2 is correct.
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Question 2 of 10
2. Question
Consider the following statements
- The total liability of the RBI is called the monetary base.
- Money multiplier can be defined as the ratio of the stock of money to the stock of high powered money in an economy.
Which of the statements given above is/are correct?
Correct
Solution (c)
The total liability of the monetary authority of the country, RBI, is called the monetary base or high powered money.
Hence Statement 1 is correct.
Money multiplier can be defined as the ratio of the stock of money to the stock of high powered money in an economy.
Hence Statement 2 is correct.
Incorrect
Solution (c)
The total liability of the monetary authority of the country, RBI, is called the monetary base or high powered money.
Hence Statement 1 is correct.
Money multiplier can be defined as the ratio of the stock of money to the stock of high powered money in an economy.
Hence Statement 2 is correct.
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Question 3 of 10
3. Question
Consider the following statements
- The total amount of deposits held by all commercial banks in the country is much lower than the total size of their reserves.
- Open Market Operations (OMO’s) includes both outright purchase and sale of Government securities.
Which of the statements given above is/are correct?
Correct
Solution (b)
The total amount of deposits held by all commercial banks in the country is much larger than the total size of their reserves.
Hence Statement 1 is incorrect.
Open Market Operations (OMOs): These include both, outright purchase and sale of government securities, for injection and absorption of durable liquidity, respectively.
Hence Statement 2 is correct.
Incorrect
Solution (b)
The total amount of deposits held by all commercial banks in the country is much larger than the total size of their reserves.
Hence Statement 1 is incorrect.
Open Market Operations (OMOs): These include both, outright purchase and sale of government securities, for injection and absorption of durable liquidity, respectively.
Hence Statement 2 is correct.
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Question 4 of 10
4. Question
Consider the following statements:
- Private sector banks are considered banking companies as defined in the Companies Act, 2013.
- Some part of equity of Regional Rural Bank is also held by the respective State Government.
Which of the statements given above is/are NOT correct?
Correct
Solution (a)
Private sector banks and foreign banks are considered banking companies as defined in the Banking Regulation Act, 1949.
Hence Statement 1 is incorrect.
The equity of the RRBs was contributed by the Central Government, concerned State Government and the sponsor bank in the proportion of 50:15:35.
Hence Statement 2 is correct.
Incorrect
Solution (a)
Private sector banks and foreign banks are considered banking companies as defined in the Banking Regulation Act, 1949.
Hence Statement 1 is incorrect.
The equity of the RRBs was contributed by the Central Government, concerned State Government and the sponsor bank in the proportion of 50:15:35.
Hence Statement 2 is correct.
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Question 5 of 10
5. Question
Consider the following statements:
- Co-operative Societies in India do not fall under the regulatory purview of RBI.
- A company registered under Companies Act and engaged in the chit business can be a NBFC.
Which of the statements given above is/are correct?
Correct
Solution (c)
Co-operative Societies in India are a State subject and they do not fall under the regulatory purview of RBI.
Hence Statement 1 is correct.
A Non-Banking Financial Company (NBFC) as defined in Sec.45-I(f) read with
Sec.45-I(c) of RBI Act, 1934 is a Company registered under the Companies Act
and engaged in the business of:
- Lending or financing
- acquisition of shares / stocks / bonds/ debentures/
- securities issued by Government or local authority
- Leasing & hire-purchase
- insurance business
- chit business
- collection of monies
- acceptance of deposits.
Hence Statement 2 is correct.
Incorrect
Solution (c)
Co-operative Societies in India are a State subject and they do not fall under the regulatory purview of RBI.
Hence Statement 1 is correct.
A Non-Banking Financial Company (NBFC) as defined in Sec.45-I(f) read with
Sec.45-I(c) of RBI Act, 1934 is a Company registered under the Companies Act
and engaged in the business of:
- Lending or financing
- acquisition of shares / stocks / bonds/ debentures/
- securities issued by Government or local authority
- Leasing & hire-purchase
- insurance business
- chit business
- collection of monies
- acceptance of deposits.
Hence Statement 2 is correct.
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Question 6 of 10
6. Question
Consider the following statements on regulators of different types of NBFC’s/activities:
- Mutual Benefit Companies are regulated by SEBI.
- Chit Funds are regulated by State Governments.
Which of the following statements is/are NOT CORRECT?
Correct
Solution (a)
Mutual Benefit Companies, Nidhi Companies are regulated by Ministry of Corporate Affairs.
Hence Statement 1 is incorrect
Chit Funds are regulated by State Governments.
Hence Statement 2 is correct
Incorrect
Solution (a)
Mutual Benefit Companies, Nidhi Companies are regulated by Ministry of Corporate Affairs.
Hence Statement 1 is incorrect
Chit Funds are regulated by State Governments.
Hence Statement 2 is correct
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Question 7 of 10
7. Question
Consider the following statements:
- Certificate of Deposits (CD) means a debt instrument issued by a corporate with original or initial maturity up to one year and issued by way of private placement.
- Commercial Paper (CP) is an unsecured money market instrument issued in the form of promissory note.
Which of the statements given above is/are correct?
Correct
Solution (b)
Non-Convertible Debenture (NCD) means a debt instrument issued by a corporate (including NBFCs) with original or initial maturity up to one year and issued by way of private placement.
Hence Statement 1 is incorrect
Commercial Paper (CP) is an unsecured money market instrument issued in the form of promissory note.
Hence Statement 2 is correct
Incorrect
Solution (b)
Non-Convertible Debenture (NCD) means a debt instrument issued by a corporate (including NBFCs) with original or initial maturity up to one year and issued by way of private placement.
Hence Statement 1 is incorrect
Commercial Paper (CP) is an unsecured money market instrument issued in the form of promissory note.
Hence Statement 2 is correct
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Question 8 of 10
8. Question
Which of the following statement is/are correct regarding White Label ATM?
- ATMs set up, owned and operated by non-bank entities are called white label ATMs.
- White label ATMs will not display logo of any particular bank.
- The operators are permitted to charge bank customer directly for the use of ATM resources.
Select the correct answer using the code given below:
Correct
Solution (b)
ATMs set up, owned and operated by non-bank entities are called white label ATMs.
Hence Statement 1 is correct
Cash in ATMs is provided by the sponsored bank while ATM machine does not have any branding of Bank. These white label ATMs will not display logo of any particular bank.
Hence Statement 2 is correct
The operators are entitled to receive a fee from the banks for the use of ATM resources by the bank’s customers and are not permitted to charge bank customer directly.
Hence Statement 3 is incorrect
TATA launched the first white label ATM in India under the brand name of Indicash.
Incorrect
Solution (b)
ATMs set up, owned and operated by non-bank entities are called white label ATMs.
Hence Statement 1 is correct
Cash in ATMs is provided by the sponsored bank while ATM machine does not have any branding of Bank. These white label ATMs will not display logo of any particular bank.
Hence Statement 2 is correct
The operators are entitled to receive a fee from the banks for the use of ATM resources by the bank’s customers and are not permitted to charge bank customer directly.
Hence Statement 3 is incorrect
TATA launched the first white label ATM in India under the brand name of Indicash.
-
Question 9 of 10
9. Question
Consider the following statements with reference to the India Post Payment Bank (IPPB).
- The bank offers only savings account up to a balance of Rupees 1 Lac.
- It operates with the Department of Posts under Ministry of Communications.
Which of the following statements is/are NOT CORRECT?
Correct
Solution (a)
The bank offers savings and current accounts up to a balance of Rs 1 Lac.
Hence Statement 1 is incorrect
India Post Payments Bank (IPPB) is a 100% government owned public sector bank, operating with the Department of Posts under Ministry of Communications,
Hence Statement 2 is correct
Incorrect
Solution (a)
The bank offers savings and current accounts up to a balance of Rs 1 Lac.
Hence Statement 1 is incorrect
India Post Payments Bank (IPPB) is a 100% government owned public sector bank, operating with the Department of Posts under Ministry of Communications,
Hence Statement 2 is correct
-
Question 10 of 10
10. Question
Consider the following statements regarding MUDRA Bank:
- It provides loans at low rates to micro-finance institutions and non-banking financial institutions which then provide credit to MSMEs.
- The Tarun category under MUDRA bank is allowed a loan upto a limit of Rs 50 thousand.
- The bank will function as a subsidiary of SIDBI.
Which of the above statements are correct?
Correct
Solution (c)
Micro Units Development and Refinance Agency Bank (or MUDRA Bank) is a public sector financial institution in India. It provides loans at low rates to micro-finance institutions and non-banking financial institutions which then provide credit to MSMEs.
Hence Statement 1 is correct
The bank will classify its clients into three categories and the maximum allowed loan sums will be based on the category:
Shishu: Allowed loans up to ₹50,000
Kishore: Allowed loans up to ₹5 lakhs
Tarun: Allowed loans up to ₹10 lakhs
Hence Statement 2 is incorrect
The bank will function as a subsidiary of the Small Industries Development Bank of India (SIDBI).
Hence Statement 3 is correct
Incorrect
Solution (c)
Micro Units Development and Refinance Agency Bank (or MUDRA Bank) is a public sector financial institution in India. It provides loans at low rates to micro-finance institutions and non-banking financial institutions which then provide credit to MSMEs.
Hence Statement 1 is correct
The bank will classify its clients into three categories and the maximum allowed loan sums will be based on the category:
Shishu: Allowed loans up to ₹50,000
Kishore: Allowed loans up to ₹5 lakhs
Tarun: Allowed loans up to ₹10 lakhs
Hence Statement 2 is incorrect
The bank will function as a subsidiary of the Small Industries Development Bank of India (SIDBI).
Hence Statement 3 is correct
