A high Statutory Liquidity Ratio (SLR) (1) restricts lending (2) increases supply of cash (3) provides funds to the state (4) increases the strength of the banks

A high Statutory Liquidity Ratio (SLR) (1) restricts lending (2) increases supply of cash (3) provides funds to the state (4) increases the strength of the banks 
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restricts lending 
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A high Statutory Liquidity Ratio (SLR) (1) restricts lending (2) increases supply of cash (3) provides funds to the state (4) increases the strength of the banks

Description : A high Statutory Liquidity Ratio (SLR) (1) restricts lending (2) increases supply of cash (3) provides funds to the state (4) increases the strength of the banks

Last Answer : (1) restricts lending Explanation: Statutory Liquidity Ratio refers to the amount that the commercial banks require to maintain in the form gold or government approved securities before providing credit to ... , suck liquidity in the market, to tighten the measure to safeguard the customers' money.

The ratio of a bank's cash holdings to its total deposit liabilities is called the - (1) Variable Reserve Ratio (2) Cash Reserve Ratio (3) Statutory Liquidity Ratio (4) Minimum Reserve Ratio

Description : The ratio of a bank's cash holdings to its total deposit liabilities is called the - (1) Variable Reserve Ratio (2) Cash Reserve Ratio (3) Statutory Liquidity Ratio (4) Minimum Reserve Ratio

Last Answer : (2) Cash Reserve Ratio Explanation: Cash Reserve Ratio (CRR) is the amount of funds that the banks have to keep with the RBI. If the central bank decides to increase the CRR, the avail-able amount with the banks comes down. The RBI uses the CRR to drain out excessive money from the system.

The ratio of a bank’s cash holdings to its total deposit liabilities is called the (1) Variable Reserve Ratio (2) Cash Reserve Ratio (3) Statutory Liquidity Ratio (4) Minimum Reserve Ratio

Description : The ratio of a bank’s cash holdings to its total deposit liabilities is called the (1) Variable Reserve Ratio (2) Cash Reserve Ratio (3) Statutory Liquidity Ratio (4) Minimum Reserve Ratio

Last Answer : Cash Reserve Ratio

The smaller the Cash Reserve Ratio, the scope for lending by banks is : (1) greater (2) smaller (3) weaker (4) lesser

Description : The smaller the Cash Reserve Ratio, the scope for lending by banks is : (1) greater (2) smaller (3) weaker (4) lesser

Last Answer : (1) greater Explanation: Cash Reserve Ratio is a regulation set by Central bank (RBI in India) which dictates the minimum amount (reserves) (hata commercial bank must be held to customer notes and deposits ... banks to hold a lesser proportion of (heir deposits in the form of deposits with the RBI.

The smaller the Cash Reserve Ratio, the scope for lending by banks is : (1) greater (2) smaller (3) weaker (4) lesser

Description :  The smaller the Cash Reserve Ratio, the scope for lending by banks is : (1) greater (2) smaller (3) weaker (4) lesser

Last Answer : greater

Which among the following is not the instrument of monetary policy A. Deficit financing B. Statutory liquidity Ratio C. Cash reserve ratio D. Open market operation

Description : Which among the following is not the instrument of monetary policy A. Deficit financing B. Statutory liquidity Ratio C. Cash reserve ratio D. Open market operation

Last Answer : A. Deficit financing

The reserves held by Commercial Banks over and above the statutory minimum, with the RBI are called - (1) Cash reserves (2) Deposit reserves (3) Excess reserves (4) Momentary reserves

Description : The reserves held by Commercial Banks over and above the statutory minimum, with the RBI are called - (1) Cash reserves (2) Deposit reserves (3) Excess reserves (4) Momentary reserves

Last Answer : (3) Excess reserves Explanation: In banking, excess reserves are bank reserves in excess of the reserve requirement set by a central bank. They are reserves of cash more than the required ... is that doing so may provide enhanced liquidity and therefore more smooth operation of payment system.

The reserves held by Commercial Banks over and above the statutory minimum, with the RBI are called (1) Cash reserves (2) Deposit reserves (3) Excess reserves (4) Momentary reserves

Description : The reserves held by Commercial Banks over and above the statutory minimum, with the RBI are called (1) Cash reserves (2) Deposit reserves (3) Excess reserves (4) Momentary reserves

Last Answer : Excess reserves

SLR stands for (a) Short liquid rupee ; (b) Statutory liquid ratio ; (c) Statutory liquid Rupee ; (d) Shorter long rung

Description : SLR stands for (a) Short liquid rupee ; (b) Statutory liquid ratio ; (c) Statutory liquid Rupee ; (d) Shorter long rung

Last Answer : ; (b) Statutory liquid ratio ;

The primary functions of Commercial Banks include-Accepting deposits and Lending funds.

Description : The primary functions of Commercial Banks include-Accepting deposits and Lending funds.

Last Answer : Justify the following statement: The primary functions of Commercial Banks include-Accepting deposits and Lending funds.

Sub-prime lending refers to ________ A. lending done by banks at rates below PLR B. Funds raised by the banks at sub-libor rates C. Group of banks which are not rated as prime banks as per Banker‘s Almanac D. lending done by financing institutions including banks to customers not meeting with normally required credit appraisal standards E. All of the Above

Description : Sub-prime lending refers to ________ A. lending done by banks at rates below PLR B. Funds raised by the banks at sub-libor rates C. Group of banks which are not rated as ... institutions including banks to customers not meeting with normally required credit appraisal standards E. All of the Above

Last Answer : D. lending done by financing institutions including banks to customers not meeting with normally required credit appraisal standards Explanation: In finance, subprime lending (also referred to ... schedule, sometimes reflecting setbacks, such as unemployment, divorce, medical emergencies, etc.

A marketing plan A)is characteristic of production -oriented firms and other mass producers. B)provides a framework for implementing and controlling marketing activities. C)always increases the marketing manager's operating costs. D)produces plans that are short -term in orientation. E)restricts the marketing manager's future options.

Description : A marketing plan A)is characteristic of production -oriented firms and other mass producers. B)provides a framework for implementing and controlling marketing activities. C)always increases the marketing ... are short -term in orientation. E)restricts the marketing manager's future options.s.

Last Answer : B)provides a framework for implementing and controlling marketing activities

Open Market Operations refer to (1) Borrowings by Scheduled banks from RBI (2) Lending by Commercial banks to industry (3) Purchase and sale of Government securities by RBI (4) Deposit mobilization

Description : Open Market Operations refer to (1) Borrowings by Scheduled banks from RBI (2) Lending by Commercial banks to industry (3) Purchase and sale of Government securities by RBI (4) Deposit mobilization

Last Answer : (3) Purchase and sale of Government securities by RBI Explanation: Open Market Operation (OMO) refers to the buying and selling of government securities in the open market in order to expand or ... in the banking system. A central bank uses OMO as the primary means of implementing monetary policy.

Open Market Operations refer to __________ . (1) Borrowings by Scheduled banks from RBI (2) Lending by Commercial banks to industry (3) Purchase and sale of Government securities by RBI (4) Deposit mobilisation

Description : Open Market Operations refer to __________ . (1) Borrowings by Scheduled banks from RBI (2) Lending by Commercial banks to industry (3) Purchase and sale of Government securities by RBI (4) Deposit mobilisation

Last Answer : Purchase and sale of Government securities by RBI

Rate of interest is determined by - (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Description : Rate of interest is determined by - (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Last Answer : (3) Liquidity preference Explanation: According to the classical view, rate of interest is determined by the interaction of supply of and demand for capital. Thus this theory is popularly called ... higher shall be the rate of interest. The liquidity preference constitutes the demand for money.

Rate of interest is determined by - (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Description : Rate of interest is determined by - (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Last Answer : (4) Commercial Banks Explanation: Bank Rate is determined by the Reserve Bank of India. The rate of interest is determined by the commercial banks in India. As per RBI notification, banks are free to determine rates of interest subject to BPLR and spread guidelines.

Rate of interest is determined by (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Description : Rate of interest is determined by (1) The rate of return on the capital invested (2) Central Government (3) Liquidity preference (4) Commercial Banks

Last Answer : Liquidity preference

Liquidity Preference means - (1) holding assets in the form of bonds and shares (2) holding assets in the form of cash (3) creation of immovable property (4) assets in the form of jewellery

Description : Liquidity Preference means - (1) holding assets in the form of bonds and shares (2) holding assets in the form of cash (3) creation of immovable property (4) assets in the form of jewellery

Last Answer : (2) holding assets in the form of cash Explanation: Liquidity preference refers to the demand for money, considered as liquidity. The concept was first developed by John Maynard Keynes in ... than other assets, in Keynesian theory based on motives of transactions, precaution, and speculation.

Liquidity Preference means (1) holding assets in the form of bonds and shares (2) holding assets in the form of cash (3) creation of immovable property (4) assets in the form of jewellery

Description : Liquidity Preference means (1) holding assets in the form of bonds and shares (2) holding assets in the form of cash (3) creation of immovable property (4) assets in the form of jewellery

Last Answer : holding assets in the form of cash 

The supply-side measure to control inflation is - (1) Reducing public expenditure (2) Price control through Public Distribution System (3) Higher taxation to mop up liquidity (4) Credit control

Description : The supply-side measure to control inflation is - (1) Reducing public expenditure (2) Price control through Public Distribution System (3) Higher taxation to mop up liquidity (4) Credit control

Last Answer : (2) Price control through Public Distribution System Explanation: The issue of inflation is addressed from both demand and supply sides. demand management is achieved by measures such as postponing public expenditure ... rice and wheat resorted to by FCI from its buffer stock in times of price rise.

Under the liquidity trap conditions, an increase in money supply will (a) increase investment (b) increase level of employment (c) reduce the rate of interest (d) have no effect on interest rate, investment and employment

Description : Under the liquidity trap conditions, an increase in money supply will (a) increase investment (b) increase level of employment (c) reduce the rate of interest (d) have no effect on interest rate, investment and employment

Last Answer : (c) reduce the rate of interest

The supply-side measure to control inflation is (1) Reducing public expenditure (2) Price control through Public Distribution System (3) Higher taxation to mop up liquidity (4) Credit control

Description : The supply-side measure to control inflation is (1) Reducing public expenditure (2) Price control through Public Distribution System (3) Higher taxation to mop up liquidity (4) Credit control

Last Answer : Price control through Public Distribution System

Which from the following is not true when the interest rate in the economy goes up? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases

Description : Which from the following is not true when the interest rate in the economy goes up? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases

Last Answer : (4) Return on capital increases Explanation: The interest rate is the cost of demanding or borrowing loanable funds. Alternatively, the interest rate is the rate of return from supplying or lending loanable funds. ... rate per unit of time, which is why it is called the rate of return on capital.

Which from the following is not true when the interest rate in the economy goes up ? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases

Description : Which from the following is not true when the interest rate in the economy goes up ? (1) Saving increases (2) Lending decreases (3) Cost of production increases (4) Return on capital increases

Last Answer : Return on capital increases

What is the Cash Reserve Ratio (CRR)? a) the fraction of the deposits that commercial banks lend to the customers b) the fraction of the deposits that RBI must keep with commercial banks c) the fraction of the deposits that commercial banks must keep with RBI d) none of the above

Description : What is the Cash Reserve Ratio (CRR)? a) the fraction of the deposits that commercial banks lend to the customers b) the fraction of the deposits that RBI must keep with commercial banks c) the fraction of the deposits that commercial banks must keep with RBI d) none of the above

Last Answer : c) the fraction of the deposits that commercial banks must keep with RBI

Identify the incorrect statement in connection with working capital management. A. Long-term funds are more expensive than short-term funds but also riskier B. The objectives of working capital management are profitability and liquidity C. Permanent current assets should be financed from long-term sources if a moderate or matching policy is adopted D. Conservative financing policies use short-term funds to finance only part of fluctuating current assets E. Aggressive financing policies increase profitability at the cost of higher risk

Description : Identify the incorrect statement in connection with working capital management. A. Long-term funds are more expensive than short-term funds but also riskier B. The objectives of ... fluctuating current assets E. Aggressive financing policies increase profitability at the cost of higher risk

Last Answer : A. Long-term funds are more expensive than short-term funds but also riskier

Dividend yield is an example for------ratio a) Solvency b) Liquidity c) Market strength d) Net worth

Description : Dividend yield is an example for------ratio a) Solvency b) Liquidity c) Market strength d) Net worth

Last Answer : c) Market strength

Capital market deals with - (1) Short term fund (2) Long term fund (3) Cash (4) Both long and short term funds

Description : Capital market deals with - (1) Short term fund (2) Long term fund (3) Cash (4) Both long and short term funds

Last Answer : (2) Long term fund Explanation: Capital markets are financial markets for the buying and selling of long-term debt or equity-backed securities. These markets channel the wealth of savers to those ... put it to long-term productive use, such as companies or governments making long-term investments.

Capital market deals with (1) Short term fund (2) Long term fund (3) Cash (4) Both long and short term funds

Description : Capital market deals with (1) Short term fund (2) Long term fund (3) Cash (4) Both long and short term funds 

Last Answer : Long term fund

If he Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should - (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Description : If he Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should - (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Last Answer : (1) lower cash reserve ratio Explanation: When the Central Bank of a country intends to increase money supply, it should lower the Cash Reserve Ratio. A decrease in CRR helps the commercial banks to ... the amount of Bank deposits and they will lend more as they have more amount as their reserve.

If the Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Description : If the Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Last Answer :  lower cash reserve ratio

Which of the following is not a measure of the Risk Management in Banks? A. CRR B. RTGS C. SLR D. Deposit Insurance

Description : Which of the following is not a measure of the Risk Management in Banks? A. CRR B. RTGS C. SLR D. Deposit Insurance

Last Answer : B. RTGS Explanation: Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with the RBI. Statutory liquidity ratio (SLR) is the Indian government term for ... is mandatory, and pays claims from a pool of funds to which every depository institution regularly contributes.

Banks are required to maintain SLR under_____ A. Section 24 of the Banking Regulation Act B. Section 35 of the Negotiable Instrument Act, 1881 C. Section 24 of RBI Act D. Section 40 of Indian Contract Act, 1872 E. None of the Above

Description : Banks are required to maintain SLR under_____ A. Section 24 of the Banking Regulation Act B. Section 35 of the Negotiable Instrument Act, 1881 C. Section 24 of RBI Act D. Section 40 of Indian Contract Act, 1872 E. None of the Above

Last Answer : A. Section 24 of the Banking Regulation Act Explanation: SLR is governed by the provisions of Section 24 of the Banking Regulation Act. There is no minimum stipulation on SLR (earlier there used to ... with an amendment to the Banking Regulation Act in 2007). However, SLR can not exceed 40%.

Furniture sold for cash -----funds flow a) Increases b) Decreases c) Deducted d) None of these

Description : Furniture sold for cash -----funds flow a) Increases b) Decreases c) Deducted d) None of these

Last Answer : a) Increases

Indicate which of the statement is incorrect with regard to coning of Wheels a)coning of wheels help the vehicle to negotiate a curve smoothly b) It helps in smooth riding c) It increases wear and Tear of wheel flanges* d)it enables the outer wheel of vehicle to take a longer distance e) it restricts the swaying of vehicles

Description : Indicate which of the statement is incorrect with regard to coning of Wheels a)coning of wheels help the vehicle to negotiate a curve smoothly b) It helps in smooth riding c) It increases ... enables the outer wheel of vehicle to take a longer distance e) it restricts the swaying of vehicles

Last Answer : c) It increases wear and Tear of wheel flanges*

Why is it necessary that banks and co-operatives increase their lending in rural areas ? Explain. -SST 10th

Description : Why is it necessary that banks and co-operatives increase their lending in rural areas ? Explain. -SST 10th

Last Answer : 1. The formal sector i.e. the banks and the cooperatives need to engage more in the lending activities because of the disadvantages posed by the informal sector. 2. There is no organisation ... business, set up small scale industries etc which would add to the development aspect of a country.

Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas ? Explain. -SST 10th

Description : Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas ? Explain. -SST 10th

Last Answer : Banks and cooperatives should increase lending facilities in rural areas: 1. The informal sector lends at a high-interest rate in rural areas so the cost for the borrower is much more. 2. When the cost ... where the amount to be repaid is more than the borrower's income and he has to borrow more.

Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas? Explain. -SST 10th

Description : Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas? Explain. -SST 10th

Last Answer : Most loans from informal lenders carry a very high interest rate and do little to increase the income of the borrowers. Hence, it is necessary that banks and cooperatives increase their lending ... the formal credit is distributed more equally so that the poor can benefit from the cheaper loans.

Why is it necessary for banks and cooperatives to increase their lending in rural areas ? -SST 10th

Description : Why is it necessary for banks and cooperatives to increase their lending in rural areas ? -SST 10th

Last Answer : Necessity for the banks and cooperative societies to increase their lending facilities in rural areas : (i) Dependence on informal sources of credit reduces. (ii) To provide more loan facilities ... to increase the lending facilities to improve the livelihood of the people in the rural areas.

Do any banks in the Chicago area specialize in small business lending?

Description : Do any banks in the Chicago area specialize in small business lending?

Last Answer : Since the recession most banks have stopped issuing small business loans unless you have a vast portfolio and have a guarantee at the bank. A better option is to apply for a Small Business Loan. Even ... Small business loans of $25,000 or less. It should be noted they're a non-profit orginization.

What is the term for a bank without any branch network that offers its services remotely? A. Internet only Banks B. Direct Bank C. Lending Institution D. Indirect Bank E. Online Bank

Description : What is the term for a bank without any branch network that offers its services remotely? A. Internet only Banks B. Direct Bank C. Lending Institution D. Indirect Bank E. Online Bank

Last Answer : B. Direct Bank Explanation: A direct bank is a bank without any branch network that offers its services remotely via online banking and telephone banking and may also provide access via ATMs ... savings which they may pass on to clients via higher interest rates or lower service charges.

Marketing in Banks is required for ? 1. Getting new customers 2. Retaining existing customers 3. Lending 4. D) Accepting of deposits 5. All of these

Description : Marketing in Banks is required for ? 1. Getting new customers 2. Retaining existing customers 3. Lending 4. D) Accepting of deposits 5. All of these

Last Answer : All of these

Manipulation in CRR enables the RBI to ……. (a) Influence the lending ability of the commercial banks ; (b) Check unemployment growth; (c) Check poverty ; (d) Increase GDP

Description : Manipulation in CRR enables the RBI to ……. (a) Influence the lending ability of the commercial banks ; (b) Check unemployment growth; (c) Check poverty ; (d) Increase GDP

Last Answer : (a) Influence the lending ability of the commercial banks ;

According to Malthusian theory of population - (1) Population increases in geometric ratio, food supply increases in arithmetic ratio (2) Population increases in arithmetic ratio, food supply increases in geometric ratio (3) Population increases in a harmonic mean, food supply increases in geometric ratio (4) Population increases in a harmonic ratio, food supply increases in a arithmetic ratio

Description : According to Malthusian theory of population - (1) Population increases in geometric ratio, food supply increases in arithmetic ratio (2) Population increases in arithmetic ratio, food supply increases in ... (4) Population increases in a harmonic ratio, food supply increases in a arithmetic ratio

Last Answer : (1) Population increases in geometric ratio, food supply increases in arithmetic ratio Explanation: In his 1798 work, An Essay on the Principle of Population, Malthus ermined the relationship between population ... e. by the repeated addition of a uniform increment in each uniform interval of time).

According to Malthusian theory of population (1) Population increases in geometric ratio, food supply increases in arithmetic ratio (2) Population increases in arithmetic ratio, food supply increases in geometric ratio (3) Population increases in a harmonic mean, food supply increases in geometric ratio (4) Population increases in a harmonic ratio, food supply increases in a arithmetic ratio

Description : According to Malthusian theory of population (1) Population increases in geometric ratio, food supply increases in arithmetic ratio (2) Population increases in arithmetic ratio, food supply increases in ... (4) Population increases in a harmonic ratio, food supply increases in a arithmetic ratio 

Last Answer : Population increases in geometric ratio, food supply increases in arithmetic ratio

Banks Must Have Liquidity?

Description : Banks Must Have Liquidity?

Last Answer : Banks must have liquidity to survive. This depends on the prime interest rates afforded by the Federal Reserve Bank. For example, in order for Nixon banks to survive, they must be able to borrow ... to the new reality of instant communication. Young people the world over know the value of things.

Which one of the following statements is false ? (A) The Open Market Operations involve the sale or purchase of govt. securities by the Central Bank (B) The RBI manages longterm liquidity through rapos (C) The RBI manages longterm liquidity through Open Market Operations (D) Open Market Operations do not alter the total stock of govt. securities but change the proportion of govt. securities held by the RBI, Commercial Banks and Co-operative Banks

Description : Which one of the following statements is false ? (A) The Open Market Operations involve the sale or purchase of govt. securities by the Central Bank (B) The RBI manages longterm liquidity through ... change the proportion of govt. securities held by the RBI, Commercial Banks and Co-operative Banks

Last Answer : Answer: The RBI manages longterm liquidity through rapos

What is the purpose of KYC in banking? A. It is used for customer identification B. It is used for increasing the CRR of banks C. It is used against money laundering D. It is used by the central bank to control liquidity E. Both (A) and (C)

Description : What is the purpose of KYC in banking? A. It is used for customer identification B. It is used for increasing the CRR of banks C. It is used against money laundering D. It is used by the central bank to control liquidity E. Both (A) and (C)

Last Answer : E. Both (A) and (C) Explanation: Know your customer (KYC) is the process of a business verifying the identity of its clients. Know your customer policies are becoming much more important globally to prevent identity theft, financial fraud, money laundering and terrorist financing.

A statement depicting the reasons for the change in cash position from one period to another a) Fund flow statement b) Statement of uses and application of funds c) Cash flow statement d) Ratio analysis

Description : A statement depicting the reasons for the change in cash position from one period to another a) Fund flow statement b) Statement of uses and application of funds c) Cash flow statement d) Ratio analysis

Last Answer : a) Fund flow statement