economics - money and credit

Class 10 - Economics

Money and Credit

Q&A
Question:

How do cooperatives function?

Answer:

Cooperatives have many members. It accepts deposits from its members. With these
deposits as collateral, the Cooperative obtains a large loan from the bank. These funds are used to provide loans to its members. Once these loans are repaid, another round of lending takes place



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Questions and Answers


Money and Credit - Questions
1.

What is Collateral ?


Answer
2.

How does money solve the problem of double coincidence of wants? Explain with an example of your own.


Answer
3.

Why do we need to expand formal sources of credit in India?


Answer
4.

What is the basic idea behind the SHGs for the poor? Explain in your own words.


Answer
5.

What are the reasons why the banks might not be willing to lend to certain borrowers?


Answer
6.

In what ways does the Reserve Bank of India supervise the functioning of banks? Why is this necessary?


Answer
7.

Analyse the role of credit for development.


Answer
8.

What are the transactions involving money ?


Answer
9.

How do cooperatives function?


Answer
10.

What is the barter system and double coincidence of wants?


Answer
11.

What are ˜demand deposits'?


Answer
12.

Look at a 10 rupee note. What is written on top? Can you explain this statement?


Answer
13.

In what ways does the Reserve Bank of India supervise the functioning of banks? Why is this necessary?


Answer
14.

Manav needs a loan to set up a small business. On what basis will Manav decide whether to borrow from the bank or the moneylender? Discuss.


Answer
15.

In India, about 80 per cent of farmers are small farmers, who need credit for cultivation.
(a) Why might banks be unwilling to lend to small farmers?
(b) What are the other sources from which the small farmers can borrow?
(c) Explain with an example how the terms of credit can be unfavourable for the small farmer.
(d) Suggest some ways by which small farmers can get cheap credit.


Answer
16.

What were the objects that were used before the use of currency?


Answer
17.

What is a cheque?


Answer
18.

What is called the ˜terms of deposit' ?


Answer
19.

Write a short note on ˜cheques'.


Answer
20.

Write about the functioning of Krishak Cooperative society.


Answer
21.

In situations with high risks, credit might create further problems for the borrower. Explain.


Answer
22.

What are Demand Deposits?


Answer
23.

Cheap and affordable credit is crucial for the countries development . Discuss.


Answer
24.

How do banks mediate between those who have surplus money and those who need money?


Answer
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