Hot amd important MCQs-Chapter 8 – Banks and the Magic of Finance-Class 7- Subject Social Science
A. Multiple Choice Questions:
1. Financial infrastructure mainly helps in:
(a) Transport of goods
(b) Flow of money
(c) Production of crops
(d) Construction of buildings
Answer: (b)
2. A bank is a financial institution that mainly:
(a) Produces goods
(b) Stores gold
(c) Accepts deposits and gives loans
(d) Collects taxes
Answer: (c)
3. Money kept in a bank account is called:
(a) Profit
(b) Deposit
(c) Loan
(d) Tax
Answer: (b)
4. Which bank account earns interest regularly?
(a) Current account
(b) Savings account
(c) Loan account
(d) Credit card account
Answer: (b)
5. Which account is best for businesspeople with frequent transactions?
(a) Savings account
(b) Fixed deposit
(c) Current account
(d) Recurring deposit
Answer: (c)
6. Interest earned on interest is called:
(a) Simple interest
(b) Bonus
(c) Compounding
(d) Discount
Answer: (c)
7. Which institution is called the ‘banker to banks’?
(a) SBI
(b) NABARD
(c) RBI
(d) Post Office
Answer: (c)
8. RBI was established in the year:
(a) 1947
(b) 1935
(c) 1950
(d) 1919
Answer: (b)
9. RBI fixes the:
(a) Price of goods
(b) Benchmark interest rate
(c) Salaries of workers
(d) Tax rates
Answer: (b)
10. Which of the following is NOT a payment mode?
(a) Cash
(b) Cheque
(c) ATM
(d) UPI
Answer: (c)
11. ATM stands for:
(a) Any Time Money
(b) Automated Teller Machine
(c) Auto Transfer Machine
(d) All Time Money
Answer: (b)
12. PIN is used mainly for:
(a) Decoration
(b) Security
(c) Advertisement
(d) Banking rules
Answer: (b)
13. UPI was launched by:
(a) RBI
(b) SBI
(c) NPCI
(d) Government of India
Answer: (c)
14. UPI allows payments using:
(a) Only cash
(b) Cheques
(c) QR codes and phone numbers
(d) ATM slips
Answer: (c)
15. A cheque is a:
(a) Plastic card
(b) Digital wallet
(c) Paper instrument
(d) Coin
Answer: (c)
MORE MCQs:
16. POS machine is used for:
(a) Printing notes
(b) Making card payments
(c) Writing cheques
(d) Opening accounts
Answer: (b)
17. Which is India’s oldest stock exchange?
(a) NSE
(b) BSE
(c) RBI
(d) SEBI
Answer: (b)
18. A share represents:
(a) A loan
(b) A tax
(c) Part ownership in a company
(d) Salary
Answer: (c)
19. When share prices fall sharply, it is called:
(a) Stock boom
(b) Inflation
(c) Stock market crash
(d) Investment growth
Answer: (c)
20. NABARD mainly supports:
(a) Urban housing
(b) Defence
(c) Rural and agricultural development
(d) Tourism
Answer: (c)
21. Post offices provide:
(a) Only letters
(b) Savings schemes
(c) Loans to companies only
(d) ATM cards
Answer: (b)
22. OTP stands for:
(a) One Time Payment
(b) One Time Password
(c) Online Transfer Password
(d) Official Transaction PIN
Answer: (b)
23. Which number is used to report cyber fraud?
(a) 112
(b) 1098
(c) 1930
(d) 100
Answer: (c)
24. Digital fraud usually happens due to:
(a) High interest
(b) Sharing OTPs and passwords
(c) Opening bank accounts
(d) Saving money
Answer: (b)
25. Financial infrastructure helps the nation by:
(a) Increasing pollution
(b) Reducing savings
(c) Promoting economic growth
(d) Stopping trade
Answer: (c)
B. True / False:
Banks encourage people to save money. (True)
Current accounts earn high interest. (False)
RBI prints and distributes currency. (True)
UPI transactions always require visiting a bank. (False)
Compounding increases savings over time. (True)
Shares are part-ownership in a company. (True)
Stock prices never change. (False)
Digital payments reduce the use of cash. (True)
OTPs should be shared with trusted callers. (False)
Financial infrastructure supports economic development. (True)
C. Match the Following:
Set 1
| Column A | Column B |
|---|---|
| (a) RBI | (iii) Central bank |
| (b) Deposit | (i) Money kept in bank |
| (c) Loan | (iv) Borrowed money |
| (d) UPI | (ii) Digital payment system |
Answer: a–iii, b–i, c–iv, d–ii
Set 2
| Column A | Column B |
|---|---|
| (a) Savings Account | (ii) Earns interest |
| (b) Current Account | (iv) Business use |
| (c) Fixed Deposit | (i) One-time deposit |
| (d) ATM | (iii) Cash withdrawal |
Answer: a–ii, b–iv, c–i, d–iii
Set 3
| Column A | Column B |
|---|---|
| (a) Share | (iii) Ownership |
| (b) BSE | (i) Stock exchange |
| (c) Compounding | (iv) Interest on interest |
| (d) PIN | (ii) Security code |
Answer: a–iii, b–i, c–iv, d–ii
Set 4
| Column A | Column B |
|---|---|
| (a) Cheque | (iv) Paper payment |
| (b) POS | (i) Card machine |
| (c) NABARD | (iii) Rural development |
| (d) OTP | (ii) Transaction safety |
Answer: a–iv, b–i, c–iii, d–ii
Set 5
| Column A | Column B |
|---|---|
| (a) NPCI | (ii) UPI launch |
| (b) ATM | (iii) 24×7 cash |
| (c) Fraud | (i) Illegal trick |
| (d) Passbook | (iv) Record of transactions |
Answer: a–ii, b–iii, c–i, d–iv
D. Assertion–Reason Questions:
1. Assertion (A): Banks pay interest on deposits.
Reason (R): Banks use deposits to give loans.
Answer: Both A and R are true, and R correctly explains A.
2. Assertion (A): UPI has reduced the use of cash.
Reason (R): UPI allows instant digital payments.
Answer: Both A and R are true, and R correctly explains A.
3. Assertion (A): Fixed deposits give higher interest.
Reason (R): Money is locked for a longer time.
Answer: Both A and R are true, and R correctly explains A.
4. Assertion (A): RBI controls the banking system.
Reason (R): RBI is India’s central bank.
Answer: Both A and R are true, and R correctly explains A.
5. Assertion (A): Digital payments can lead to fraud.
Reason (R): People may share OTPs unknowingly.
Answer: Both A and R are true, and R correctly explains A.
To Learn more Click Below:
MCQs:
Chapter 1-The Story of Indian Farming – CLICK HERE
Chapter 2 – India and Her Neighbours – CLICK HERE
Chapter 3 – Empire and Kingdoms: 6th to 10th Centuries – CLICK HERE
Chapter 4 -Turning tides: 11th and 12th Centuries – CLICK HERE
Chapter 5 – India: A Home to Many- CLICK HERE
Chapter 6 – The State, the government and You- CLICK HERE
Chapter 7 – Infrastructure: Engine of India’s Development – CLICK HERE
Chapter 8 – Banks and the Magic of Finance- CLICK HERE