Commerce Exam > Commerce Questions > Directions: In the following questions, a st...
Start Learning for Free
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:
Assertion (A): Currency held with the government and banks is not included in the Money Supply.
Reason (R): Currency can be legally used to make payment of debts or other obligations.
- a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).
- b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).
- c)Assertion (A) is true but reason (R) is false.
- d)Assertion (A) is false but reason (R) is true.
Correct answer is option 'B'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
Directions: In the following questions, a statement of assertion (A) ...
Money supply includes the currency that is in circulation with the public at a particular point of time, hence it does not include the money held by government or commercial banks as it is not in circulation with the public at a given point in time.
View all questions of this test
Most Upvoted Answer
Directions: In the following questions, a statement of assertion (A) ...
Assertion (A): Currency held with the government and banks is not included in the Money Supply.
Reason (R): Currency can be legally used to make payment of debts or other obligations.
Explanation:
The correct answer is option B, which states that both the assertion (A) and reason (R) are true, but the reason is not the correct explanation of the assertion.
Definition of Money Supply:
Money supply refers to the total amount of money available in an economy at a given point in time. It includes all the physical currency in circulation, such as coins and banknotes, as well as the demand deposits held by commercial banks and other financial institutions.
Explanation of Assertion (A):
Currency held with the government and banks is not included in the Money Supply. This is because the currency held by the government and banks is not readily available for circulation in the economy. It is considered as a part of the country's reserves or holdings and is not counted as part of the money supply.
Explanation of Reason (R):
Currency can be legally used to make payment of debts or other obligations. This means that currency is a legal tender, which can be used to settle financial obligations. However, the reason alone does not explain why currency held with the government and banks is not included in the money supply. It only establishes the fact that currency can be used for making payments.
Additional Information:
The money supply is usually measured by different monetary aggregates, such as M0, M1, M2, and M3, which include various forms of money. M0 represents the narrowest measure of money supply and includes only the physical currency in circulation (coins and banknotes) and the reserves held by commercial banks. M1 includes M0 plus demand deposits held by banks. M2 includes M1 plus time deposits, savings deposits, and money market mutual funds. M3 includes M2 plus large time deposits, institutional money market funds, and other large liquid assets.
In conclusion, while the assertion is true that currency held with the government and banks is not included in the money supply, the reason provided does not fully explain this exclusion.
Reason (R): Currency can be legally used to make payment of debts or other obligations.
Explanation:
The correct answer is option B, which states that both the assertion (A) and reason (R) are true, but the reason is not the correct explanation of the assertion.
Definition of Money Supply:
Money supply refers to the total amount of money available in an economy at a given point in time. It includes all the physical currency in circulation, such as coins and banknotes, as well as the demand deposits held by commercial banks and other financial institutions.
Explanation of Assertion (A):
Currency held with the government and banks is not included in the Money Supply. This is because the currency held by the government and banks is not readily available for circulation in the economy. It is considered as a part of the country's reserves or holdings and is not counted as part of the money supply.
Explanation of Reason (R):
Currency can be legally used to make payment of debts or other obligations. This means that currency is a legal tender, which can be used to settle financial obligations. However, the reason alone does not explain why currency held with the government and banks is not included in the money supply. It only establishes the fact that currency can be used for making payments.
Additional Information:
The money supply is usually measured by different monetary aggregates, such as M0, M1, M2, and M3, which include various forms of money. M0 represents the narrowest measure of money supply and includes only the physical currency in circulation (coins and banknotes) and the reserves held by commercial banks. M1 includes M0 plus demand deposits held by banks. M2 includes M1 plus time deposits, savings deposits, and money market mutual funds. M3 includes M2 plus large time deposits, institutional money market funds, and other large liquid assets.
In conclusion, while the assertion is true that currency held with the government and banks is not included in the money supply, the reason provided does not fully explain this exclusion.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer?
Question Description
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer?.
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer?.
Solutions for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer?, a detailed solution for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? has been provided alongside types of Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): Currency held with the government and banks is not included in the Money Supply.Reason (R): Currency can be legally used to make payment of debts or other obligations.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'B'. Can you explain this answer? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup