Money and Banking Class 12 MCQ Quiz – Test Your Understanding!

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Are you ready to test your knowledge of Money and Banking from the Class 12 Economics syllabus? This chapter explains the functions of money, the role of the central bank, and the credit creation process in an economy. Understanding these concepts is crucial for CBSE board exams and competitive exams.

About the Quiz

  • Chapter Name: Money and Banking
  • Subject: Economics
  • Book: NCERT Class 12 Economics
  • Question Type: Multiple Choice Questions (MCQs)
  • Leaderboard: Yes (Check Your Rank!)

Why Take This Quiz?

✔ Helps in CBSE board exam revision
✔ Strengthens understanding of monetary policy and banking system
✔ Enhances knowledge of RBI’s role in regulating money supply
✔ Track your progress with the leaderboard

Click Below to Start the Quiz!

Chapter 2 Money and Banking

1 / 15

“The value of all goods and services can be expressed in monetary units.” On the basis of the given statement, identify the function performed by money:

2 / 15

The Reserve Bank of India can increase the money supply in the economy by ____________. (Choose the correct alternative)

3 / 15

Which of the following formulae is INCORRECT?

4 / 15

How does a cut in the Repo rate by RBI affect the demand for goods and services?

5 / 15

Also See:  CBSE Sample Paper vs. NCERT Questions – What’s More Important?

Supply of money refers to……................. (Choose the correct alternative)

6 / 15

In a hypothetical economy, Mr. Neeraj has deposited ₹100 in the bank. If it is assumed that there is no other currency circulation in the economy, then the total money supply in the economy will be ________________. (Fill up the blank with the correct alternative)

7 / 15

A bank ‘run’ occurs when a large number of customers of a bank withdraw their deposits simultaneously. This can cause a bank to become insolvent if it cannot pay back all the depositors. Which of the following facts about a bank make a bank run possible?

8 / 15

Suppose in an economy, the initial deposits of ₹ 400 crores lead to the creation of total deposits worth ₹ 4000 crores.

Under the given situation the value of reserve requirements would be________ (Fill up the blank with the correct alternative)

9 / 15

What happens to the money multiplier when the Cash Reserve Ratio (CRR) increases?

10 / 15

Also See:  Money and Banking Class 12: Must-Know Questions and Answers

If the legal reserve requirement (LRR) is 20%, what is the value of the money multiplier?

11 / 15

Identify which of the following is not a function of the Reserve Bank of India? (Choose the correct alternative)

12 / 15

Money can be used to transfer purchasing power from the present to the future. Which specific function of money is this called?

13 / 15

Which of these do not fall under the purview of the Central Bank?

  1. controlling money supply

  2. providing loans to citizens

  3. issuing currency

  4. holding foreign exchange reserves

14 / 15

Demand Deposits include______ and _________. (Fill up the blank with the correct alternative)

  1. Saving account deposits

  2. Fixed deposits

  3. Current Account Deposits

  4. Post Office Savings

15 / 15

Which of the following statements about the money supply is correct?

Your score is

The average score is 69%

Leaderboard – Top Scorers

Check the top scorers here!

Pos.NameScoreDurationPoints
1Roni87 %4 minutes 53 seconds13
2Tushar kumar80 %3 minutes 41 seconds12
3AP80 %4 minutes 48 seconds12
4Tushar kumar53 %18 minutes 11 seconds8
5ss47 %9 minutes 44 seconds7

Key Topics Covered in the Quiz

✔ Functions of Money – Medium of exchange, Store of value, Unit of account
✔ Money Supply & Its Measures (M1, M2, M3, M4)
✔ Functions of Commercial Banks – Credit creation process
✔ Role of the Reserve Bank of India (RBI) – Monetary policy tools (CRR, SLR, Repo Rate, Reverse Repo Rate)
✔ Instruments of Credit Control – Quantitative & Qualitative methods

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