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General Awareness - Banking System & Capital Market short Questions & Answers for Examinations | Page-5

Questions
41 The first Bank established in India was:
A Bank of Hindustan
B State Bank of India
C Punjab National Bank
D Central Bank

Answer: Option [A]

The first Bank established in India was Bank of Hindustan. Bank of Hindostan, a now defunct bank, is considered as among the first modern banks in Colonial India. It was established in 1770 and located in the then Indian capital, Calcutta.

42 The system of value added taxation is applicable to :
A Income tax
B Excise duties
C Estate duty
D Property tax

Answer: Option [B]

The system of value added taxation is applicable to Excise duties. An excise or excise tax (sometimes called an excise duty) is a type of tax charged on goods produced within the country (as opposed to customs duties, charged on goods from outside the country).

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43 Who is responsible for the collection and publication of monetary and financial information ?
A Finance Ministry
B Reserve Bank of India
C National Sample Survey Organization
D Auditor and Comptroller General of India

Answer: Option [B]

Reserve Bank of India is responsible for the collection and publication of monetary and financial information. It was established with the objective of ensuring monetary stability and operating the currency and credit system of the country to its advantage. Its functions comprise monetary management, foreign exchange and reserves management, government debt management, financial regulation and supervision, apart from currency management and acting as banker to the banks and to the Government.

44 The primary objective of Nationalization of Banks was:
A Improving credit facilities
B Financing the industries
C Improving security of deposits
D Consolidating the economy

Answer: Option [D]

The primary objective of Nationalization of Banks was Consolidating the economy. In the banking history of India, the Nationalisation of Commercial Banks in July 1969, was the most significant, steps that Government of India took with the principle objective of encouraging even the poorest to join the economy as an active participant in nation's socio-economic development.

45 Which two of the following nationalized banks have been merged as per the recommendation of the Narasimham Committee on banking reforms ?
A Parur Bank if India and bank of India
B New bank of India and bank of India
C Central Bank of India and Corporation Bank
D Punjab National Bank and New bank of India

Answer: Option [D]

The correct answer is Punjab National Bank and New bank of India.

The Narasimham-II Committee was tasked with the progress review of the implementation of the banking reforms since 1992 with the aim of further strengthening the financial institutions of India. It focussed on issues like the size of banks and capital adequacy ratio among other things

The only example of the merger of two PSBs is the merger of New Bank of India with Punjab National Bank in 1993. However, this was not a voluntary merger.

46 What are gilt-edged securities in India ?
A Securities issued by the government
B Securities issued by the private sector
C Securities issued by the multinationals
D Securities issued by the joint venture companies

Answer: Option [A]

The correct answer is Securities issued by the government. Gilt-edged securities are high-grade bonds issued by certain national governments. “Government security” means a security created and issued by the Government for the purpose of raising a public loan or for any other purpose.

47 Bank rate is the rate at which:
A The Reserve Bank of India lends to the public
B A bank lends to the public
C The Government of India lends to other countries
D The Reserve Bank of India gives credit to commercial banks

Answer: Option [D]

Bank rate is the rate at which the Reserve Bank of India gives credit to commercial banks. A bank rate is the interest rate at which a nation's central bank lends money to domestic banks, often in the form of very short-term loans. Managing the bank rate is a method by which central banks affect economic activity.

48 The national Stock Exchange is located in:
A New Delhi
B Nagpur
C Mumbai
D Kolkata

Answer: Option [C]

The national Stock Exchange is located in Mumbai. National Stock Exchange of India Limited is the leading stock exchange under the ownership of various group of domestic and global financial institutions, public and privately owned entities and individuals. It is located in Mumbai, Maharashtra.

49 Which among the following is the oldest Development Financial Institution of India ?
A UTI
B IDBI
C ICICI
D IFCI

Answer: Option [D]

The Industrial Finance Corporation of India(IFCI) established on July 1, 1948 was the first and oldest Development Financial Institution of India

50 In which year ‘Over the Counter Exchange’ (OTC) was founded ?
A 1990
B 1992
C 1993
D 1994

Answer: Option [A]

The correct answer is 1990. Over the Counter Exchange of India (OTCEI) was incorporated in 1990 under the Companies Act, 1956 and was recognised as a stock exchange under the Securities Contracts Regulation Act, 1956. It commenced operations in the year 1992.

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