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CBSE Class 10 Economics Chapter 3 Money and Credit MCQ Questions with Answers from Understanding Economic Development Book
Money and Credit MCQs – Here is a compilation of Free MCQs of Class 10 Economics Understanding Economic Development Book Chapter 3 Money and Credit. Students can practice free MCQs as have been added by CBSE in the new exam pattern. At the end of Multiple Choice Questions, the answer key has also been provided for your reference.
Q1. Surrender of notes to the bank by the government by a specific period and receive new currency notes is called…….
A. Digital banking
B. Banking
C. Demonetisation
D. Monetization
Q2. Give an example of digital banking?
A. Cheque
B. Demand draft
C. Deposit form
D. ATM card
Q3. What is the double coincidence of wants?
A. both parties have to agree to sell and buy each other’s commodities
B. Exchanging commodity for commodity
C. Credit on commodity
D. Loan on commodity till sold further
Q4. What eliminates the need for double coincidence of wants?
A. Credit
B. Debit
C. Money
D. Barter system
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Q5. Since money acts as an intermediate in the exchange process, it is called ………
A. Medium of trade
B. Medium of Exchange
C. Medium of Business
D. Medium of transaction
Q6. What were the earliest form of objects used as money in India?
A. grains and cattle
B. Coins
C. Jewels
D. Land
Q7. What came after grains and cattle as a medium of exchange in India?
A. Currency notes
B. metallic coins — gold, silver, copper
C. Barter system
D. Value for land
Q8. The modern currency is without any use of its own, then why is it accepted as a medium of exchange?
A. Because it is convenient
B. It has digital and manual system
C. It can be used in foreign exchange
D. Is authorised by the government of the country
Q9. Which is an important form in which people hold money?
A. Moneylenders
B. Bank deposits
C. Post office deposits
D. Mutual funds
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Q10. People also have the provision to withdraw the money as and when they require the deposits in the bank accounts to be withdrawn, what are these deposits called?
A. Fixed deposits
B. Savings
C. Demand deposits
D. Demand drafts
Q11. A ………… is a paper instructing the bank to pay a specific amount from the person’s account to the person in whose name it has been issued?
A. Deposit slip
B. Withdrawal slip
C. ATM facility
D. Cheque
Q12. The facility of cheques against demand deposits makes it possible to directly settle payments without the use of………
A. Deposit slip
B. Cash
C. Moneylender
D. Other funds
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Q13. M. Salim wants to withdraw Rs 20,000 in cash for making payments to Prem after Prem receives the money he deposits it in his own account? What is the result?
A. Salim’s balance in his bank account increases, and Prem’s balance increases.
B. Salim’s balance in his bank account decreases and Prem’s balance increases.
C. Salim’s balance in his bank account increases and Prem’s balance decreases
D. None of the above
Q14. Banks in India these days hold about ………. of their deposits as cash. This is kept as a provision to pay the depositors who might come to withdraw money from the bank on any given day.
A. 20%
B. 25%
C. 30%
D. 15%
Q15. How do banks mediate between those who have surplus funds (the depositors) and those who are in need of these funds (the borrowers)?
A. Mutual funds
B. Share dividend
C. Loans
D. Deposits
Q16. …………refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment.
A. Debit
B. Cash transaction
C. Credit
D. Trade
Also See: Class 10 Geography Chapter 3 “Water Resources” MCQs
Q17. In an SHG most of the decisions regarding savings and loan activities are taken by
A. Bank.
B. Members
C. Non-government organization.
D. None of the above
Q18. In rural areas, the main demand for credit is for …………….
A. Industry
B. Crop production.
C. Irrigation
D. Cultivation
Q19. ………………….is an asset that the borrower owns (such as land, building, vehicle, livestock, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid?
A. Debt trap
B. Guarantee
C. Collateral
D. Warranty
Q20. Interest rate, collateral and documentation requirement, and the mode of repayment together comprise what is called the …………..?
A. Debt trap
B. Terms of credit
C. Guarantee
D. Warranty
Q21. Which organizations arrange formal sector loans?
A. Banks
B. Cooperatives
C. Moneylenders
D. A & B
Q22. According to the information given on formal and informal loans how much of the loan is taken by the poor household from informal sources?
A. 60%
B. 75%
C. 85%
D. 70%
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Q23. Which is one of the major reasons which prevent the poor from getting bank loans?
A. Illiteracy
B. Lack of availability of banks in rural areas
C. Absence of collateral
D. Shy to approach formal organizations
Q24. ……………..costs of borrowing increase the debt-burden?
A. high
B. low
C. equal
D. none
Q25. What kind of loans do members of SHG take?
A. Individual loans
B. Group loans
C. Society loans
D. None of the above
Q26. RBI sees that the banks give loans not just to profit-making businesses and traders but also to………..?
A. Cooperatives
B. Small scale industries & small borrowers
C. SGH
D. All of the above
Q27. According to the information given on formal and informal loans how much of a loan is taken by the rich household from informal sources?
A. 40%
B. 5%
C. 10%
D. 20%
Q28. Grameen Bank of Bangladesh is one of the biggest success stories, in 2018 it had over …. million members in about 81,600 villages.
A. 8
B. 10
C. 7
D. 9
Q29. In situations with high risks, credit might create further problems for the borrower, what is it called?
A. Absence of collateral
B. Debt trap
C. Debit
D. Demand deposits
Q30. What is the aim of the loans sanctioned to SHG?
A. To establish industries
B. To establish fisheries
C. To create self-employment opportunities
D. For the development of agriculture
Answer key for Class 10 Economics Understanding Economic Development Book Chapter 3 – Money and Credit MCQs
| Q. | Ans. | Q. | Ans. | Q. | Ans. |
| 1 | C | 11 | D | 21 | D |
| 2 | D | 12 | B | 22 | C |
| 3 | A | 13 | B | 23 | C |
| 4 | C | 14 | D | 24 | A |
| 5 | B | 15 | C | 25 | B |
| 6 | A | 16 | C | 26 | B |
| 7 | B | 17 | B | 27 | C |
| 8 | D | 18 | B | 28 | D |
| 9 | B | 19 | C | 29 | B |
| 10 | C | 20 | B | 30 | C |
Also, See :
- MCQs for Class 10 Economics Book Chapter 1 “Development”
- MCQs for Class 10 Economics Book Chapter 2 “Sectors of the Indian Economy”
- MCQs for Class 10 Economics Book Chapter 4 “Globalization and the Indian Economy”
- MCQs for Class 10 Economics Book Chapter 5 “Consumer Rights”