CURRENCY INFLATION MCQS SET 24

CURRENCY INFLATION MCQS SET 24

231) Devaluation of currency will be more beneficial if:
A) Prices of domestic goods remain constant
B) Prices of imports remains constant
C) Prices of exports remain constant
D) None of the above
Correct Answer: Prices of exports remain constant
   
232) Resurgent India Bonds were issued in US dollar, Pound Sterling and
A) Euro
B) French Franc
C) Japanese Yen
D) Deutsche Mark
Correct Answer: Deutsche Mark   
 
233) Devaluation of currency leads to
A) Increase in domestic prices
B) Erratic fluctuations in domestic prices
C) Fall in domestic prices
D) None of the above
Correct Answer: Increase in domestic prices
   
234) Minimum Fiduciary System has been in force in India since:
A) 1955
B) 1957
C) 1961
D) 1965
Correct Answer: 1957
   
235) Who among the following used to manage the issue of currency in India before Reserve Bank of India came into existence?
A) Mint Manager
B) Currency Manager
C) Controller of Currency
D) Controller of Money
Correct Answer: Controller of Currency

236) Among the remedies of inflation we cannot include:
A) better capacity utilisation
B) reducing budgetary deficit
C) an efficient public distribution system
D) lowering bank rate
Correct Answer: lowering bank rate
   
237) A very rapid growth in prices in which money loses its value to the point where even barter may be preferable is known as:
A) inflation
B) hyper-inflation
C) deflation
D) disinflation
Correct Answer: hyper-inflation
   
238) Coins of rupee one and above are called:
A) Large Coins
B) Mint Coins
C) Money Coins
D) Rupee Coins
Correct Answer: Rupee Coins
   
239) Which of the following is wrongly matched?
A) Stagflation: slow pace of economic activity due to falling prices
B) Depression: Insufficient demand causing large scale unemployment of men and machinery over a long period of time
C) Recession: Reduction in demand and production/ investment over a short period of time
D) Boom: Rapid and all-round spurt in economic activity
Correct Answer: Stagflation: slow pace of economic activity due to falling prices
   
240) A high rate of inflation tends to worsen balance of payments because:
A) prices of imported goods rise
B) prices of exported goods rise making exports less competitive
C) prices of imported goods fall and hence more is imported
D) prices of exported goods fall and hence less amount is obtained in terms of foreign exchange
Correct Answer: prices of exported goods rise making exports less competitive