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CDS – 2 VIRAAT 2023

Monetary Policy & Banking System DPP: 3.2

1. Which bank has launched first ATM in India in the 6. Which are the followings are private sector banks in
year 1987? India?
(a) State bank of India (a) PNB & SBI
(b) Reserve bank of India (b) RBI & Bank of Baroda
(c) HSBC (c) HDFC & Kotak Mahindra
(d) ICICI (d) Canara Bank & Union Bank

2. __________ bank was the first Indian commercial 7. In Which of the following year Jan-Dhan Yojana
bank which was wholly owned and managed by was launched?
Indians? (a) 2014
(a) Bank of Baroda (b) 2015
(b) State Bank of India (c) 2016
(c) Reserve Bank of India (d) 2013
(d) Central Bank of India
8. ___________ is calculated by dividing its current
3. Credit Card was launched by which bank of India assets by its current liabilities?
for the first time? (a) Liquidity Ratio
(a) State bank of India (b) Cash Reserve Ratio
(b) Central bank of India (c) Profitability Ratio
(c) ICICI (d) Solvency Ratio
(d) HSBC
9. At which minimum rate central bank gives loans to
4. Which among the following are the true functions of commercial banks?
banking sector:- (a) Reverse Repo Rate
1. Handles deposit (b) Reverse Bank Rate
2. Provides financial help to borrowers (c) Bank Rate
3. Ensure market liquidity (d) None of the above
4. Provide locker facilities to the customers
(a) 1 & 2 is true 10. _______ was set up by RBI to protect the interest of
(b) 3 & 4 is true small depositors in the case of bank failure or bank
(c) 2, 3 & 4 is true corrupt?
(d) All above them (a) DICGC
(b) LIC
5. Reserve bank of India uses cash reserve ratio as a (c) RDI
monetary policy tool to control _______? (d) RDS
(a) Inflation
(b) Deflation
(c) Employment
(d) Poverty
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Answer Key
1. (c) 6. (c)
2. (d) 7. (a)
3. (b) 8. (a)
4. (d) 9. (c)
5. (a) 10. (a)
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Hints and Solutions

1. (c) 6. (c)
Explanation: Explanation:
The first ATM in India was launched by Hongkong, Option A, B and C are the public sectors bank.
and Sanghai Banking Corporation limited (HSBC). At present there are 12 public sectors bank in india
This bank was opened in Hongkong on 3 March and at present there are 21 private sector banks in
1865. India.
In private sector banks majority of bank’s equity is
2. (d) owned by a private company.
Explanation:
Central Bank of India was established in the year 21 7. (a)
December 1911. Explanation:
Sorabji Pochkhanawala was the founder of this Jan-dhan Yojana was launched on 28 August2014
bank. by PM Narendra Modi.
Beti Bachao - Beti Padhao Yojana was launched on
3. (b) 22 January 2015.
Explanation: Mudra Yojana provides loan to small businessmen
First Credit Card was launched by Central Bank of from 50 to 10 lakhs to grow their business.
India in the year 1980. Ujjwala yojana was launched by PM Modi on 1
Biggest advantage of Credit Card is it is easy to May 2016, its aims is distribute LPG (liquid
access. petroleum gas) connections to the women of below
It gives EMI facilities to the customers. poverty line.
And One of the biggest advantages of this card is
that you buy first and pay later. 8. (a)
Explanation:
4. (d) Liquidity ratio measures the companies’ ability to
Explanation: pay off its short-term debts as they become due by
Banking sector is a network that facilitates the using the companies’ current or quick assets.
money flow in the economy.
Banks provide a safe place to store extra cash and 9. (c)
credit. Explanation:
Banks use deposits to make loans and provide them Bank rate is the interest rate of the bank at which a
to needy ones. nation’s central bank gives money to the domestic
banks. These are in the form of short-term loans
5. (a) provided by the central bank.
Explanation: In Reverse Repo rate, within the country central
By increasing cash reserve ratio, RBI forces bank to bank of the country can borrow money from the
save more money with it, which reduces banks’ commercial banks.
ability to lend money to borrowers. This reduces the
supply of the money into the market, thereby it 10. (a)
helps to bring down in inflation. Explanation:
DICGC (deposit insurance and credit guarantee
Corporation) protects depositors’ money. They
cover all commercial and cooperative banks.
Maximum amount covered by the bank is up to 5
lakhs.

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