CBSE Questions for Class 10 Economics Money And Credit Quiz 2 - MCQExams.com

Money Supply Measure “M1” M1 consists of the most highly liquid assets. That is, M1 includes all forms of assets that are easily exchangeable as payment for goods and services. It consists of coin and currency in circulation, traveler's checks, demand deposits, and other checkable deposits.

Group members take the important decisions of Self Help Groups because:

-The group owes responsibility for the repayment of loans.

-Other members of the group follow seriously if in case of non-repayment of loan by one member.

-The groups decide with respect to the loans to be granted-the purpose, amount, interest to be charged, repayment schedule, etc. 

• In 1861-62, the British rulers introduced its first paper money: ₹10 notes in 1864, ₹5 notes in 1872, ₹10,000 notes in 1899, ₹100 notes in 1900, 50-rupee notes in 1905, 500-rupee notes in 1907 and 1000-rupee notes in 1909.

Majority of the people in rural areas depend on informal sources for loans.

Informal sources include landlords and rich farmers.

 The main reasons behind this are:

1. The number of banks in rural remote areas is low.

2. Bank loans require proper documents and collateral (security). Absence of collateral is one of the major reasons which prevents the poor from getting bank loans.

3. Informal lenders like landlords, know the borrower personally and hence, are often willing to give a loan without a security.

Kushanas were the first to introduce gold currencies in India around 1st century A.D. 

First one to issue gold coins were Kushanas under the rule of Wema (Kadphises 2)

Formal sector credit in India includes loans from banks and cooperatives. RBI supervises their functions of giving loans. Rich urban households depend largely on formal sources of credit. Lower rate of interest on loans is charged as compared to informal sources of credit.

In order to to ensure stability of the exchange rate, the rupee is pegged to a basket of currencies.

This is because India trades with multiple countries which have different currencies.

1. Original sale deed of the property.
2. Documents to indicate the borrower's banks deposits.
3. Other assets owned by the borrower.
   

In economics, Gresham's law is a monetary principle stating that "bad money drives out good". For example, if there are two forms of commodity money in circulation, which are accepted by law as having similar face value, the more valuable commodity will disappear from circulation.

• Formal sources of credit are:
• Banks and Co-operative societies.
  
• Reserve bank of India will supervise the activities of the banks and co-operative societies in India.
  
• Employers do not fall under formal sources of credit lenders in our country.

A self-help group is an economic intermediary group of 10 to 20 local women or men between 18 to 40 years. Most self-help groups are situated in India, though SHGs can be established in other countries, particularly in South Asia and Southeast Asia. 

SHG is not whatever thing but a group of people who are on daily wages, they form a group and from that group, one person collects the money and gives the wealth to the person who is in need. Members also make modest measure savings contributions over a few months until there is adequate money in the group to begin lending. 

Thus, the correct option is C.