In NCERT Class 12 Economics Chapter 3, titled "Money and Banking", students delve into the concepts of money, its evolution, and its role in an economy. This chapter covers the functions of money, the creation of money by commercial banks, and the role of the Reserve Bank of India (RBI) as the central bank. The chapter also explains monetary policies, instruments of credit control, and how the banking system supports economic growth.
This article provides a comprehensive resource for exam preparation. It includes sample MCQs and subjective questions for CBSE and CUET, alongside downloadable PDFs of Class 12 Economics Chapter 3 MCQs and previous year questions for detailed practice of NCERT Class 12 Money and Banking.
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NCERT Class 12 Economics Chapters
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CUET Free Master Classes:
Class 12 Economics Chapter 3 MCQs
This question bank includes previous years' CUET and CBSE MCQs, along with questions curated by subject experts. Below are 5 sample multiple-choice questions (MCQs) for Class 12 Economics Chapter 3: Money and Banking. For the full set of 50 questions, download the PDF using the link provided below.
1- Money is an asset which can be stored for use in future.‘
In the light of given statement, identify the function of money.
(a) A measure of value (b) A standard of deferred payment
(c) A store of value (d) A medium of Exchange
2. Identify the first and foremost role of money
(a) Medium of exchange (b) Unit of account
(c) Means of deferred payments (d) Measure of value
3. Identify the function of money from points given below: Choose the correct option.
(a) Medium of understanding (b) Medium of health
(c) Medium of exchange (d) Medium of printing
4. A fictional bank has deposits equal to Rs.5000 crores and reserves equal to Rs.6000 crores.
What is the net worth of this bank?
(a) Rs.11,000 crores (b) Rs.5000 crores (c) (-) Rs.1000 crores (d) Rs.1000 crores
5. The foremost role of money is:
(a) Unit of account (b) Measure of deferred payment
(c) Medium of exchange (d) Store of value.
Class 12 Economics Chapter 3 Subjective Questions Without Solutions
This question bank includes previous years' CBSE subjective questions (2 marks and above) without solutions, along with expert-curated questions. Below are 5 sample subjective questions for Class 12 Economics Chapter 3: Money and Banking. To access all questions, download the PDF from the link provided below.
- Explain the 'store of value' function of money.
(CBSE 2017, 3M)
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- Explain the 'medium of exchange' function of money. How has it solved the related problem created by barter?
(CBSE 2016, 4M)
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- Explain the 'standard of deferred payment' function of money. How has it solved the related problem created by barter?
(CBSE 2016, 4M)
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- State the meaning and components of money supply.
(CBSE 2017, 3M)
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- Using a hypothetical numerical example, explain the effect of a rise in Reserve Ratio on credit creation by commercial banks.
(CBSE 2023, 4M)
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Sub Areas of Chapter 3: Money and Banking
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Chapter Name
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Sub Topics
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Money and Banking
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3.1 Definition and Functions of Money
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3.2 Evolution of Money
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3.3 Credit Creation by Commercial Banks
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3.4 Role of RBI as the Central Bank
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3.5 Monetary Policy and Credit Control
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3.6 Instruments of Monetary Policy
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Review of NCERT Class 12 Economics Chapter 3
In NCERT Class 12 Economics Chapter 3, "Money and Banking," students understand the significance of money and its role in economic activities. The chapter explores the banking system's functions, including credit creation by commercial banks and the RBI's monetary policies. These concepts are essential for comprehending the structure of an economy.
Mastering this chapter is crucial for analyzing the financial system and preparing for exams like CBSE, CUET, and other competitive exams.
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