56-Monetary Aggregates and Money Supply

Banking Awareness Multiple Choice Questions (MCQs) and Answers with explanation on Monetary Aggregates and Money Supply for IBPS Bank PO, IBPS Bank Clerical, RRB PO and Clerical, SBI PO and SBI Clerical, IBPS Recruitments, RBI Grade B and RBI Banking and CAT / MBA entrance examinations of India

1. Who among the following issues metallic coins in India?

[A] RBI
[B] Government of India
[C] Banks and financial institutions
[D] Any of the above can issue it.

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2. Which of the following is issued by RBI?

[A] Currency notes
[B] Coins
[C] Both 1 and 2
[D] None of the above

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3. Which of the following about money supply measure adopted in 1977 is correct?

[A] M2= M1 +demand deposits with post offices
[B] M3= M1 +term deposits with banks
[C] M4=M3+total deposits with post offices
[D] All of the above

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4. Which of the following is most liquid measure of money supply in India?

[A] M2
[B] M4
[C] M1
[D] M3

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5. Which of the following is known as broad money?

[A] M3
[B] M1
[C] M2
[D] M4

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6. Which of the following about money supply measures adopted in 1998 is wrong?

[A] M1= currency with public +demand deposits with banking system + other deposits with RBI
[B] M2= M1 + savings deposits of post office savings bank
[C] M3= M1+ time deposits with banking system
[D] None of the above

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7. In which year does Reserve Bank of India introduced the concept of classification of money into M1, M2, M3 and so on?

[A] 1956
[B] 1961
[C] 1977
[D] 1998

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8. Which one out of the following is least liquid among the measures of money supply?

[A] M1
[B] M2
[C] M3
[D] M4

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9. Which one out of the following is most liquid among the measures of money supply?

[A] M1
[B] M2
[C] M3
[D] M4

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10. Which among the following are known as Narrow Money?

[A] M1 and M2
[B] M2 and M3
[C] M3 and M4
[D] M1 and M2

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