Banking MCQ Quiz - Objective Question with Answer for Banking - Download Free PDF

The correct answer is World Intellectual Property Organization, Cornell University and INSEAD.

Key Points

• The Global Innovation Index (GII) is a source of insight into the multidimensional facets of innovation-driven growth and provide the tools that can assist in tailoring policies to promote long-term output growth, improved productivity, and job growth. 
• The GII global ranking is published by World Intellectual Property Organisation (WIPO) .
• It is a collaborative effort, with the GII also being developed by Cornell University and INSEAD. 
• India’s Confederation of Indian Industry (CII) is one of the knowledge partners which assists GII team in bringing out the annual ranking.
• GII is published annually since 2007.
• Switzerland is the world's most-innovative country followed by Sweden, the United States of America (U.S.), the Netherlands and the United Kingdom (U.K.), according to the 2019 edition of the Global Innovation Index (GII).

The correct answer is 151st.

In News

• India ranks 151st in the 2025 World Press Freedom Index, showing a slight improvement from 159th in 2024.

Key Points

• India ranks 151st in the 2025 World Press Freedom Index, improving from 159th in 2024.
• The report highlights significant threats to press freedom in India, including financial instability among media outlets.
• Many media outlets in India have shut down due to economic hardship, further limiting press freedom.

Additional Information

• World Press Freedom Index
  • The World Press Freedom Index is compiled by Reporters Without Borders, evaluating the press freedom situation in 180 countries.
  • It measures the degree of freedom available to journalists in each country and the dangers they face in reporting the news.
• Press Freedom Threats
  • Press freedom faces significant challenges globally, including economic pressures, violence against journalists, and government censorship.

The correct answer is 151st.

In News

• India ranks 151st in the 2025 World Press Freedom Index, showing a slight improvement from 159th in 2024.

Key Points

• India ranks 151st in the 2025 World Press Freedom Index, improving from 159th in 2024.
• The report highlights significant threats to press freedom in India, including financial instability among media outlets.
• Many media outlets in India have shut down due to economic hardship, further limiting press freedom.

Additional Information

• World Press Freedom Index
  • The World Press Freedom Index is compiled by Reporters Without Borders, evaluating the press freedom situation in 180 countries.
  • It measures the degree of freedom available to journalists in each country and the dangers they face in reporting the news.
• Press Freedom Threats
  • Press freedom faces significant challenges globally, including economic pressures, violence against journalists, and government censorship.

The correct answer is EXIM Bank.

Key Points

• The Indian Development and Economic Assistance Scheme (IDEAS) facilitates Lines of Credit (LOC) to partner countries to support developmental projects.
• EXIM Bank (Export-Import Bank of India) is the implementing agency responsible for operationalizing the LOC under the IDEAS framework.
• EXIM Bank extends these LOCs on behalf of the Government of India to promote economic ties and export growth.
• The LOCs under IDEAS are aimed at financing infrastructure, industrial, and developmental projects in recipient countries, primarily in Asia, Africa, and Latin America.
• This initiative strengthens India's soft power and enhances bilateral trade and investment relations with partner nations.

Additional Information

• Export-Import Bank of India (EXIM Bank):
  • EXIM Bank was established in 1982 under the Export-Import Bank of India Act, 1981.
  • It is a specialized financial institution tasked with financing, facilitating, and promoting India’s international trade.
  • EXIM Bank plays a critical role in supporting Indian exporters and overseas investments through credit and guarantee programs.
• Lines of Credit (LOC):
  • LOCs are concessional loans extended by EXIM Bank under the IDEAS scheme to enable partner countries to import goods and services from India.
  • The terms of these loans typically include lower interest rates and longer repayment periods.
  • LOCs often focus on sectors such as energy, transportation, agriculture, and healthcare.
• Objectives of IDEAS:
  • To strengthen India’s diplomatic and economic relationships with other nations.
  • To promote Indian exports, particularly in capital goods, machinery, and project services.
  • To contribute to the development of infrastructure and human resources in partner countries.
• Key Beneficiaries:
  • Recipient countries in Asia, Africa, Latin America, and the Caribbean.
  • Indian exporters and industries benefit through increased demand for Indian goods and services.
  • Strengthening of bilateral ties enhances India's strategic and economic interests globally.

The correct answer is the Reserve Bank of India.

Key Points

• The repo rate in India is fixed and monitored by India's central banking institution, the Reserve Bank of India.
• It allows the central bank to control liquidity, money supply, and inflation level in the country.
• When commercial banks approach the Reserve Bank of India for funds, they’re charged a certain amount of interest.
• The rate at which RBI lends these finances to commercial banks is called the repo rate.

Important Points

• Reverse repo rate is the interest offered by the RBI to banks that deposit funds into the treasury. For instance, when banks generate excess funds, they may deposit the money in the central bank.
• A high repo rate helps drain excess liquidity from the market, whereas a high reverse repo rate helps inject liquidity into the economic system.
• The repo rate is always higher than the reverse repo rate.
• Repo rate is used to control inflation and reverse repo rate is used to control the money supply.

Additional Information

• Human Development Index is a statistical tool used to measure a country's overall achievement in its social and economic dimensions.
• It was developed by Pakistani economist Mahbub-ul-Haq and Indian economist Amartya Sen.
• Every year United Nation Development Program (UNDP) ranks countries based on the HDI report.

• The correct answer is option 4, i.e., Seventh Schedule.
• Seventh Schedule of the Constitution of India provides Union List, State List, and Concurrent List.
• The Seventh Schedule talks about the allocation of powers and functions between Union & States.
• Article 246 under the Seventh schedule consists of three lists: Union List, State List, and Concurrent List.
• The Union List originally comprises 97 subjects. Now, it has 100 subjects
• The State List comprises of 61 items in which the respective State Government has the sole powers to legislate.
• The Concurrent List comprises of 52 items in which both Central and State Governments jointly have the powers to legislate.

The Correct Answer is Option 4 i.e 55%.

• According to the World Bank, 55 percent of new bank accounts, opened globally during the period 2014-2017, are from India.
• World Bank Global Findex 2017 stated that Pradhan Mantri Jan Dhan Yojana (PMJDY) has resulted in the opening from India of 55% of all new bank accounts in the world during the period 2014-2017.
• As per the World Bank Global Findex Report, the percentage of adult bank account holders in India increased to 80% in 2017 as compared to 53% in 2014.

The correct answer is Rate at which RBI borrows money from commercial banks.Key Points

• Reverse repo rate:
  • It is the rate at which the Reserve Bank of India (RBI) borrows money from commercial banks.
  • It is a tool used by RBI to control the money supply in the economy.
  • Repo rate is usually higher than the Reverse  repo rate.
  • A higher reverse repo rate means commercial banks will earn higher returns by lending to RBI, leading to a decrease in lending to customers and a decrease in money supply in the economy.

Additional Information

• Option 1 is incorrect as RBI does not borrow from foreign banks, it only lends to them.
• Option 3 is the repo rate, not the reverse repo rate.
• Option 4 is incorrect as commercial banks borrow from RBI, not foreign banks.
• Reverse repo rate is an important tool in monetary policy as it helps RBI control inflation and maintain economic stability.

The correct answer is Bank Rate.Key Points

• Bank Rate is the rate at which the Reserve Bank of India (RBI) is ready to buy or rediscount bills of exchange or other commercial papers from commercial banks or financial institutions.
• The Bank Rate is used by the RBI to control the money supply in the economy and to stabilize the inflation rate.
• The Bank Rate is also known as the Discount Rate, and it is the highest rate at which the RBI lends money to commercial banks.
• The other options mentioned in the question are also important tools used by the RBI to regulate the economy.

Additional Information

• Cash Reserve Ratio (CRR) is the percentage of deposits that banks have to maintain with the RBI.
• Repo Rate and Reverse Repo Rate are the rates at which banks borrow money from or lend money to the RBI, respectively.

• The base financial year for the calculation of the all India Index of Industrial Production (IIP) is 2011-2012.
• IIP index shows the performance of different industrial sectors of the economy of India.
• It is published on a monthly basis by CSO (Central Statistical Organisation).

The correct answer is Lower the Cash Reserve Ratio (CRR), lower will be the liquidity in the system.Key Points

• A lower Cash Reserve Ratio (CRR) will actually increase the liquidity in the system, as banks will have more funds available to lend.
• The Cash Reserve Ratio (CRR) is the percentage of deposits that banks are required to maintain with the central bank as a reserve.
• A higher CRR means banks have less funds available to lend, reducing liquidity in the system.

Additional Information

• The Statutory Liquidity Ratio (SLR) is the percentage of deposits that banks are required to maintain in the form of liquid assets such as government securities.
• A lower SLR means banks have more funds available to lend, increasing liquidity in the system.
• An increase in bank rate, which is the rate at which the central bank lends to commercial banks, makes borrowing more expensive for banks, reducing their ability to lend and decreasing the money supply.
• A higher CRR means banks have less funds available to lend, reducing liquidity in the system.
• A lower SLR means banks have more funds available to lend, increasing liquidity in the system.

The correct answer is 1969.Key Points

• In 1969, the Government of India nationalized the fourteen major Indian scheduled commercial banks, which had deposits of over Rs. 50 crores.
• The nationalization was aimed at achieving the following objectives:
  • To ensure that credit is available to priority sectors such as agriculture, small-scale industries, and exports.
  • To ensure that banking services are available to all sections of society, especially the poor and the marginalized.
  • To promote the development of banking infrastructure in rural areas.

Additional Information

• The fourteen banks that were nationalized in 1969 were:
  • Allahabad Bank
  • Bank of Baroda
  • Bank of India
  • Bank of Maharashtra
  • Canara Bank
  • Central Bank of India
  • Dena Bank
  • Indian Bank
  • Indian Overseas Bank
  • Punjab Sind Bank
  • Punjab National Bank
  • Syndicate Bank
  • Union Bank of India
  • United Bank of India
• The Reserve Bank of India, which regulates and supervises the banking system in India, was established in 1935.

The correct answer is Yes Bank.

Key Points

• Yes Bank has announced the launch of an annual startup enabler program, YES BANK Agri Infinity.
• It seeks to co-develop digital financial solutions for the food and agriculture ecosystem by mentoring entrepreneurial ventures in the field.
• As part of the agri-fintech enabler program, early as well as growth-stage startups are invited to apply with their proposals. 

Additional Information

• Yes Bank Limited is an Indian private sector bank headquartered in Mumbai, India.
• It was founded by Rana Kapoor and Ashok Kapur in 2004.