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Assertion & Reason Test: Money & Credit - 1 - Class 10 MCQ


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10 Questions MCQ Test - Assertion & Reason Test: Money & Credit - 1

Assertion & Reason Test: Money & Credit - 1 for Class 10 2024 is part of Class 10 preparation. The Assertion & Reason Test: Money & Credit - 1 questions and answers have been prepared according to the Class 10 exam syllabus.The Assertion & Reason Test: Money & Credit - 1 MCQs are made for Class 10 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Assertion & Reason Test: Money & Credit - 1 below.
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Assertion & Reason Test: Money & Credit - 1 - Question 1

Match the following items given in column A with those in column B:

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 1

(i) Barter system: A barter system is known as an old method of exchange. This system has been practised for centuries and long before money was introduced. People started exchanging services and goods for other services and goods in return. The value of bartering items is negotiable with the other party.

(ii) Debt-trap: A debt trap means the inability to repay credit amount. It is a situation where the debtor could not be able to repay the credit amount.

(iii) Formal sector loans: Formal sector loans are such loans which are taken either from the banks or the co-operatives. While informal sector loans are those which are taken from moneylenders, traders, employers, relatives and friends.

(iv) Reserve Bank of India: The Reserve Bank of India (RBI) is the central bank of India, which was established on Apr. 1, 1935, under the Reserve Bank of India Act. The Reserve Bank of India uses monetary policy to create financial stability in India, and it is charged with regulating the country's currency and credit systems.

(v) Double coincidence of wants: In a barter economy, an exchange between two people requires a double coincidence of wants, which means that what one person wants to buy is exactly what the other person wants to sell.

Assertion & Reason Test: Money & Credit - 1 - Question 2

Match the following items given in column A with those in column B:

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 2

(i) Financial Formal Institutions: Formal financial institutions is an institution which has a legal basis and subject to regulation by the government.

(ii) Financial Informal Institutions: The informal financial system comprises of moneylenders, indigenous bankers, lending pawn brokers, landlords, traders etc.

(iii) Actual Investment: Actual Investment is the investment expenditures that the business sector actually undertakes during a given time period, including both planned investment and any unplanned inventory changes.

(iv) Deferred Payments: A deferred payment is an agreement to pay for something at a later date. The most important aspect of a deferred payment plan is the promise you make to pay the whole amount back in the future.

Assertion & Reason Test: Money & Credit - 1 - Question 3

Arrange the following in the correct sequence:

(i) Online payment, Debit card, Credit cards

(ii) Precious metal coins (gold, silver, copper)

(iii) Grain and Cattle

(iv) Modern Currency-Paper notes and coins

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 3
Correct sequence is

(iii) Grain and Cattle: The cattle feeding sector relies on cereal grains as concentrated sources of energy, particularly in finishing rations where cereals make up to 90% of the ration dry matter.

(ii) Precious metal coins (gold, silver, copper): Silver is often described as "poor man's gold," but in fact nowadays silver may have more in common with copper than with gold.

(iv) Modern Currency-Paper notes and coins: Modern forms of money include currency paper notes and coins. Currency is accepted as a medium of exchange as it is authorised by the government of the country.

(i) At last Online payment, Debit card, Credit cards.

Assertion & Reason Test: Money & Credit - 1 - Question 4

Analyze the information given below, considering one of the following correct options:

Rita has taken a loan of ₹ 7 lakhs from the bank to purchase a car. The annual interest rate on the loan is 14.5 percent and the loan is to be repaid in 3 years in monthly instalments. The bank retained the papers of the new car as collateral, which will be returned to Rita only when she repays the entire loan with interest. Analyse the loan information given above, considering one of the following correct options.

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 4
Terms of credit are the requirements need to be satisfied for any credit arrangements. It includes interest rate, collateral, documentation and mode of repayment. However the terms of credit vary depending upon the nature of lender, borrower and loan.
Assertion & Reason Test: Money & Credit - 1 - Question 5

Analyze the information given below, considering one of the following correct options:

Mohan is an agricultural labourer. There are several months in a year when he has no work and needs credit to meet his daily expenses. He depends upon his employer, the landowner for credit who charges an interest rate of 5 per cent per month. Mohan repays the money by working physically for the landowner on his farmland.

Over the years his debt will –

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 5
Over the years his debt will increase because of increasing interest and non-payment of monthly amount
Assertion & Reason Test: Money & Credit - 1 - Question 6

Analyze the information given below, considering one of the following correct options:

Mahesh is a small farmer. He has taken a loan of ₹2 lakhs from the money leader to meet the expenses of cultivation. The annual interest rate on the loan is very high, so he is unable to repay the loan and he is caught in a debt. He has to sell a part of the land to pay off the debt. Analyse the loan information given above, considering one of the following correct option :

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 6
A debt trap means that one owes a huge amount of money to various institutions or people, which feels neverending. Sometimes loans are taken to gain financial advantage, which is a wise decision. On the other hand, a debt trap is a situation we never want to be in.
Assertion & Reason Test: Money & Credit - 1 - Question 7

Analyze the information given below, considering one of the following correct options:

Ramu is a shoe manufacturer and he wants to directly exchange shoes for rice without the use of money. Now he will have to look for a rice growing farmer who not only wants to sell rice but also wants to buy the shoes in exchange. Analyse the information given above, considering one of the following correct option:

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 7
In a barter economy, an exchange between two people requires a double coincidence of wants, which means that what one person wants to buy is exactly what the other person wants to sell.
Assertion & Reason Test: Money & Credit - 1 - Question 8

Analyze the information given below, considering one of the following correct options:

Megha has taken a loan of ₹ 6 lakhs from the bank to purchase a house. The annual interest rate on the loan is 14 percent and the loan is to be repaid in 12 years in monthly installments. Megha had to submit to the bank, documents showing her employment records and salary before the bank agreed to give her the loan. Analyse the loan information given above, considering one of the following correct option :

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 8
Formal sources go through a process of critical review and revision before they are published. The credentials of the author or creator are provided along with references and citations. Formal sources are most commonly found in academic library collections.
Assertion & Reason Test: Money & Credit - 1 - Question 9

Analyze the information given below, considering one of the following correct options:

A shopkeeper Sudha has to make a payment to the wholesaler and writes a cheque for a specific amount to the wholesaler. The wholesaler takes this cheque, and deposits it in his own account in the bank. The money is transferred from one bank account to another bank account in a couple of days. The transaction is completed without any payment of cash.

Analyse the information given above, considering one of the following correct option:

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 9
A demand deposit account (DDA) is a bank account from which deposited funds can be withdrawn at any time, without advance notice. DDA accounts can pay interest on the deposited funds but aren't required to. Checking accounts and savings accounts are common types of DDAs.
Assertion & Reason Test: Money & Credit - 1 - Question 10

In the question given below, there are two statements marked as Assertion (A) and Reason (R). Read the Statements and choose the correct option :

Assertion (A) : No individual or organisation is allowed to issue currency notes in India.

Reason (R) : In India, only RBI issues currency notes on behalf of the Central Government.

Detailed Solution for Assertion & Reason Test: Money & Credit - 1 - Question 10
In India, the Reserve Bank of India issues currency notes on behalf of the Central Government. As per Indian Law, no other individual or organization is allowed to issue currency.
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