ManavRachna International Institute of Research and Studies

Department of Business Studies, FCBS

End Semester (Theory) Examination, October 2020
BBA (General)/BBA (Banking and Financial Markets), 5th Semester
Money and Banking (BBA-DE-502)

Time: 3 Hours Max.Marks: 100

Note: Attempt 5 questions in all. Q1 is compulsory and attempt two questions each from PART-
A and PART-B. All questions carry equal marks.All the answer sheets are to be numbered such
as 1/5, 2/5, …….5/5 if you have answered in 5 pages. Create a single PDF file of answer sheet/s,
upload it on ERP and also mail it to Dr. R K Aryaat rakesh.fcbs@mriu.edu.in for BBA Sec A
and to Dr. Swati Watts at swatiwatts.fcbs@mriu.edu.infor BBA Sec B and Banking & Financial
Markets

Q1. Do as directed: (2×10)

a. Whether money lenders are part of the financial system (true/false) and according to your
view how much is their percentage in rural areas (10-15%, 15-20%, 20-40% or more than
40%)
b. When the inflation starts going up what should be the interest rates (go up or go down)
c. Whether the stock markets are part of the financial system (true/false). They are the part
of financial system because these allow trading in the new issues(true/false)
d. How the penalty is charged on the late payment (by way of penal interest rates or fixed
amount)
e. The long term securities traded in the market are expressed in terms of yield (true/false).
f. The interest rates in various markets of India differ (correct/ incorrect)
g. The significant revenue collected by the banks comes from the non-credit based services
(yes/no). Non-credit based services are lending. (true/false)
h. NPA (write the expansion also) results in increasing the profit (true/false).
i. RBI important function is to regulate the money supply in the economy to keep the
inflation always on the higher side (true/false). Because higher inflation is good for
economic growth (true/false)
j. What does OMO stands for? It help in controlling the ---------------------- in the system.
PART A
Q2. What do you understand by the term money? How does money help in the economy? Why
the appropriate money supply is important? What happens when the money supply is not
appropriate? (20)

Q3.Bring out sharp distinction between Banking and non-banking financial intermediaries.
Illustrate with four points that in which respect each of these are useful to the economic
development. (20)

Q4.Whether the risks affect the interest rates? What are those risks? Explain any two of them as
to how these affect the interest rates. (20)
 PART B

Q5. Consider the State Bank of India. What should be its organizational structure as do other
banks also have the same structure? With this structure how must it be managed i.e. all functions
including operational, HR, marketing and finance. Your answer should be very systematic.

(20)
Q6. What do you think whether central bank is essential? In case it is essential how its
essentiality can be felt in five ways. Elaborate. (20)

Q7.Whether it is possible to manage the economy without monetary policy? If not then explain
how monetary policy has been helping in variety of ways with special focus on stabilizing the
economic growth. (20)