Showing 1–10 of 246 questions
Q.1
Medium
What is the Base Rate set by RBI as of 2024?
A
4.5%
B
5.5%
C
6.5%
D
RBI no longer uses Base Rate
Correct Answer:
D. RBI no longer uses Base Rate
Explanation:
RBI discontinued Base Rate framework in October 2019 and replaced it with repo rate-based monetary transmission
Q.2
Medium
If the Repo Rate is 6.5% and Reverse Repo Rate is 6.25%, which statement is true?
A
Banks pay more interest on deposits than they earn on lending
B
Banks earn more on lending than they pay on deposits
C
Both rates are equal
D
The difference is irrelevant to banking operations
Correct Answer:
B. Banks earn more on lending than they pay on deposits
Explanation:
Repo Rate is higher than Reverse Repo Rate, so banks earn more when lending to the central bank versus borrowing
Q.3
Medium
A customer deposits ₹1,00,000 in a Fixed Deposit at 7% p.a. for 2 years with annual compounding. What is the final amount?
A
₹1,14,490
B
₹1,14,980
C
₹1,15,490
D
₹1,16,490
Correct Answer:
A. ₹1,14,490
Explanation:
A = P(1 + r/100)^n = 1,00,000(1.07)^2 = 1,00,000 × 1.1449 = ₹1,14,490
Q.4
Medium
In a bank's balance sheet, what does NPA (Non-Performing Asset) refer to?
A
New Product Advancement
B
Loans where payments are overdue by 90+ days
C
Net Profit Amount
D
National Policy Agreement
Correct Answer:
B. Loans where payments are overdue by 90+ days
Explanation:
NPA is a classification for loans where principal or interest payment is overdue by 90 days or more
Q.5
Medium
If a bank's CAR (Capital Adequacy Ratio) is 15%, what does this indicate?
A
The bank has ₹15 in capital for every ₹100 of assets
B
The bank is undercapitalized
C
The bank exceeds the minimum regulatory requirement
D
Both A and C
Correct Answer:
D. Both A and C
Explanation:
CAR of 15% means the bank has adequate capital buffer. Regulatory minimum is 10.5%, so 15% indicates compliance and strength
Q.6
Medium
What is the current Statutory Liquidity Ratio (SLR) requirement set by RBI as per 2024-2025?
Explanation:
As of 2024, RBI maintains SLR requirement at 18% of Net Demand and Time Liabilities (NDTL)
Q.7
Medium
If a bank's Net Interest Margin (NIM) increased from 2.8% to 3.2%, what does this signify?
A
The bank's profitability has decreased
B
The bank's profitability has improved
C
The bank's lending has decreased
D
There is no impact on profitability
Correct Answer:
B. The bank's profitability has improved
Explanation:
An increase in NIM indicates the bank is earning more profit on its lending and deposit operations
Q.8
Medium
What does the term 'Markdown' mean in banking context?
A
Reduction in interest rates on deposits
B
A discount offered by the bank on services
C
The difference between buying and selling price of securities
D
A penalty charged by RBI
Correct Answer:
C. The difference between buying and selling price of securities
Explanation:
Markdown refers to the spread between the bid-ask prices in securities trading by banks
Q.9
Medium
According to the 2024-2025 pattern, what is the current CRR (Cash Reserve Ratio) in India?
Explanation:
As of 2024, RBI has maintained CRR at 4% of NDTL for banks
Q.10
Medium
If Bank's total assets are ₹10,00,000 crores and equity is ₹50,000 crores, what is the leverage ratio?
A
5:1
B
10:1
C
15:1
D
20:1
Explanation:
Leverage Ratio = Total Assets / Equity = 10,00,000 / 50,000 = 20:1
