Banking Awareness Quiz - 2

A large inflow of foreign exchange into the country can lead to an increase in the money supply, which in turn can create asset bubbles and inflation. When there is a surplus of foreign currency, the central bank may intervene by purchasing it, thereby increasing the domestic money supply. This excess liquidity can lead to an increase in demand for assets such as stocks and real estate, causing their prices to rise rapidly and potentially creating asset bubbles. Additionally, the increase in money supply can also lead to inflationary pressures in the economy, as there is more money chasing the same amount of goods and services.

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Exogenous is not used in Economics. This term is mainly used in the field of biology and refers to factors or variables that are external to a system or model. In Economics, terms like depreciation, deep market, and zero-sum game are commonly used to describe concepts related to the economy and market dynamics.

All of these can levy Service Tax because according to the Indian Constitution, both the Union Government, State Governments, and Union Territory Governments have the power to impose and collect taxes. Service Tax is a type of indirect tax that is levied on the provision of certain services. Therefore, all three levels of government have the authority to impose Service Tax within their respective jurisdictions.

The term "Third World" is not used in the world of economics/finance. It is a term that was coined during the Cold War to classify countries that were not aligned with either the capitalist or communist blocs. It is a political and sociological term rather than an economic or financial one.

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The role of these correspondents will be to assist rural people in their day-to-day banking activities. This can include tasks such as opening bank accounts, depositing and withdrawing money, providing information on various banking products and services, and facilitating transactions for the rural population who may not have easy access to traditional bank branches. These correspondents will act as a bridge between the banks and the customers, ensuring that banking services are accessible and convenient for rural communities.

The installation of Note Sorting Machines in banks will help them count the notes quickly and accurately. These machines are designed to efficiently and accurately count large volumes of currency, reducing the time and effort required for manual counting. This will not only save time for bank employees but also improve the overall efficiency of banking operations. Additionally, the use of these machines will minimize the chances of human error in counting, ensuring accurate results.

India wants all payments to be made in US Dollars whereas China pays in its own currency. This means that India prefers to receive payments in US Dollars, while China prefers to pay in its own currency, which is the Renminbi (RMB). As a result, there is a payment imbalance between the two countries, with India importing more from China but not receiving payments in the desired currency. This can lead to challenges in managing trade and currency exchange rates between the two countries.

Australia was the first country to introduce plastic notes. In 1988, the Reserve Bank of Australia issued the world's first polymer banknotes as a response to counterfeiting issues with paper currency. These plastic notes are made from a polymer material that is more durable, secure, and resistant to wear and tear compared to traditional paper notes. The introduction of plastic notes by Australia has since been followed by several other countries around the world.