[WpProQuiz 108]
Daily MCQs: UPSC Prelims Marathon: April 11
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72 responses to “Daily MCQs: UPSC Prelims Marathon: April 11”
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Daily Quiz: April 11
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5 of 5 questions answered correctlyYour time: 00:03:16
You have reached 5 of 5 scores, (100%)
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how is it that high possibility of inflation by increasing liquidity… i mean the word high is out of context.. anyone agrees?
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3/5 .
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5 of 5 questions answered correctly
Your time: 00:01:56
You have reached 5 of 5 scores, (100%)
Thanks for attempting the Quiz.
Economics
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But second question was the one which came in exam ?
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4 of 5 questions answered correctlyFinancial stability and development council me unstablity .. 😀
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jldbaji kb km slow hogi(le doobti h)?? -
4 of 5 questions answered correctly
Your time: 00:01:30Itne saare council bana do ki yaad kar kar ke hum pagla jaein -_-
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What if banks decide to narrow down their profit margin,they can still offer higher interest on savings account and will be able to offer loans as well.
Another argument against the assumption could be. Since banks are offering a higher interest rate on savings account, probably more people will find it lucrative to deposit money with the particular bank. Ultimately bank has more money to lend. -
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In fact opposite of statement is correct :- When bank has to give more interest on deposit , bank has to find more borrower to recover that interest.
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sry..it is indian express dated 10th april..
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Good morning friends,
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We aim to help you finish Medieval in 15 minutes a for a week. This is our effort for the same –
https://edwitty.in/medieval-india -
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Thanks team
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high interest rate on small saving means parcial liquid crunch at time of lending
but can u tell me csat-2 arithmatic and reasononing level from ur point of view -
Daily Quiz: April 11
Results
5 of 5 questions answered correctlyYour time: 00:01:46
You have reached 5 of 5 scores, (100%)
Thanks for attempting the Quiz.
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Kindly let me know the date
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4 of 5 questions answered correctly
Your time: 00:01:33
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Exactly what upsc asks, not easy but conceptual. If one is committing huge mistakes here than you are likely to do same in real exam.
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refer to hindu editiorial published recently
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5/5…:)
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Only government issued security like KVP sovereign bond passes the money to Public account of India, not by financial institution like insurance, mutual fund etc. Almost entire money turn back to market, banks and others
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You have reached 3 of 5 scores, (60%)
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Amazing that didn’t know all this despite reading things around banking & small savings!! Thanks!!
I was in in the impression that higher deposit rates are countered by higher lending rates & it doesn’t impact lending capacity. Now I’ll reassess this aspect!!PS- If ever Israel’s national bird is asked in Prelims, I owe you a treat!!..;)
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Hahaha !!!
Hmm, wo to hai – but how will the bank function, if no one deposit money !!!
Ab you have two options – invest in schemes which give interest rates of 7% and 8% – you will definitely go for 8% scheme. If Banks are recalcitrant that they will not increase their interest rates on deposits, there will be no inflow of money. Then, what will they lend. How will they earn profits from spread b/w loan and deposit – kuch hoga hi nhi !!! -
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5 of 5 questions answered correctly
Your time: 00:01:40 -
Hehehehe…..Nice talk to u
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Hi Saurabh
See, it is not directly affecting the capacity, but indirectly it is.
Banks are forced to increase the interest rates on deposits, which decrease the amount of money they have with them to lend. So, lending capacity will decrease.Regarding small saving schemes, they are floated by government
Small Savings constitute a major resource to execute welfare activities of the Government.
The Directorate of Small Savings is mainly concerned with the promotion of various Small Savings Schemes formulated by Government of India. Small Savings Schemes are implemented through the Department of Posts, and 15 year Public Provident Fund Scheme is implemented through Head Post offices as well as Banks.
Money from this small saving schemes go to PUBLIC ACCOUNT of India. -
as mrunal mentioned in his lecture..
agar BAAL KI KHAAL NIKALOGE TO ECONOMICS SE PHD KARNI PADEGI BHAI…..
OVERALL TO PROCESS VAHI HAI BUT COMPETITIVE EXAM PURPOSE SE FORUM IAS KA ANSWER SAHI HAI.. 🙂 🙂
ha ha…… -
Saara matter trade-off ka hai….Ek taraf loan lene ka cost aur dusri taraf opportunity cost loan nahi lene ka…..
Practically, opportunity cost always higher. Loan kam lenge…but lenge…. Without loan who will meet the cost incurred in the terms of poor health, losing of house, and so on. -
@disqus_jLDTtVZcmd:disqus- Who gets money invested in these small savings schemes? As in don’t the banks get to use that money?
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if able plz clear my one doubt . i have posted that. plz do scrolling and see my question ..
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but bhai
here is my point , at certain level banks cant increase interest rates on deposit becoz it will decrease banks spread i.e. margin b/w lending rate and interest rate on deposit. as u mentioned above if lending rates becomes very high then loans becomes unattractive . -
@Civilserviceaspirant:disqus @karna:disqus – Very interesting what you pointed out. However, doesn’t it seem that “Capacity to lend” & “Lending being unattractive” are separate? As far as I understand, capacity could simply point to the availability of capital like very directly understandable in case of CRR, SLR increment!
-What I can understand is that may be people wouldn’t invest as much in banks due to these attractive Small savings schemes which may affect banks capacity. Is that right?
– Can you please elaborate on who governs the deposits in these schemes & aren’t these used by banks for lending? -
Money encircles round and round and ultimately goes to bank. No matter small savings are offered by bank or others
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rg8 bro…
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People borrow money to fulfill his requirement. Unlock agar zarurat hai to woh loan lenge hi. Haan yeh baat alag hai ke jahan unko cheap lagega wahan se lenge. But aisa nhi hota hai ke higher saving rate ki wajah se woh deposit karna start kar denge. Personal money requirement has very high opportunity cost.
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Competition bhai !!!
Bank have to increase their interest rates to compete with small saving schemes
I have mentioned in detail in comment above. Please refer it -
Monetary policies tool are L.A.F. , C.R.R. M.S.F and O.M. . In these tools in which refinance is done by RBI ?? @ @
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See, Small saving is different instrument not available with banks as karna too has mentioned
What happens is these small saving schemes will offer high (around 7.5% interest rates of deposits).
In order to compete with them, Banks will have to increase the interest rates provided to their customers. If they increase it, they will have to increase the interest rates on the loans offered by them, which will make lending unattractive.
This was one of the issue as pointed out by Eco survey of last year for ”NON TRANSMISSION of policy rates” on the interest rates charged by the banks. -
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Results
3 of 5 questions answered correctlyYour time: 00:04:05
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Bhai..
Here small saving scheme considered to be like Kisan Vikas Patra ,PPF, pension scheme, insurance companies having FD facilities ..So when public get high rate of return then Janta will invest money there that’s why banks will have less money to lend and affect the bank capacity of lending -
Here small saving is different instrument ,not available to banks…U can refer to last year economic survey under the problems of monetary policy transmission
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So Relevant and Nice Question…..!!!Learning Is A Ongoing Process Which Is Never Going To End.So Much Learnt Today…..!!!
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Further as per explanation given by forum IAS, bank will have less money to lend.
Bhai, bank will have more money to lend kyunki zyada log paisa deposit karenge. Further Jo higher interest me jayega usse zyada lending se wasool hoga….
Kyunki lending always higher than deposit rate -
Not agree with solution of Q4. High interest rate on small saving will attract more deposits and so higher money available to bank to lend. Further, the lending rate always higher than saving rate, bank will cover it’s higher cost.
Even in the case of liquidity crunch it is common to see high interest on deposit. Even payment bank is providing 7-7.5% interest rate on savings which is highest, when it is not lending. Should we think that payment bank will face difficulty? No… So I don’t think higher interest on saving is problematic until nd unless the cost of bank is being recovered. -
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refinance facility instrument is tool of monetary policy ? But how..
Is lowering the repo rate ,would be considered here.
Plz clarify this.. -
4/5….easy questions
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analytical questions the except Q2 – could be done by understanding the concept. Isliye today’s questions were good
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4/5..as always.. Economy..my love..
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4/5…good qstn forum,,,,
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Really nice questions.Thank you forumias for questions and Explanations!
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very2 poor -
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