All India Management Association (AIMA) 2007 M.B.A Marketing Management Central Banking

13. E The essential element of banking supervision is the ability of the supervisor to supervise over the banking organization as a consolidated whole. < TOP >

14. E Off-site prudential supervisory returns were 1st introduced in 1995.These are called DSB returns. Return on connected lending (Credit to directors and managers) is not a common return for banks operating in India.. < TOP >

15. A The Federal Reserve System has a decentralized structure. The FRS comprises the Board of Governors .FOMC, Federal Reserve banks, member Banks and Advisory committee. HM treasury is the constituent of UK Financial system. < TOP >

16. E RRBs operate in rural areas, not covered by the scheduled banks; and the co-operative and special purpose rural banks. < TOP >

17. C The banking system in India has 3 tiers.Foreign banks in India fall under private banks category. < TOP >

18. C The bank has no obligation to third parties arising out of the duty to pay its customers’ cheques and the payee of cheques issued by a customer cannot sue the paying banker. < TOP >

19. B Current Accounts come under facilitating services. While the choices a, c ,d and e are supporting services payment services relate to core services. < TOP >

20. E In the deregulated place both cost and amount of deposits of the banks are heavily influenced by all the factors mentioned. < TOP >

21. E In pricing deposits banks consider all choices.. < TOP >

22. B Conditional fee pricing category favors large denomination deposits because services are free if the account balance stays above minimum figure. < TOP >

23. E The liquidity level to be maintained by a bank should first, give for deposit withdrawals and second, to accommodate the increase in credit demands. While deposit withdrawals must be honored immediately, it is also of priority to ensure that legitimate loan requests of customers are met regardless of the fund’s position. Satisfactory credit accommodation ultimately outcomes in more business for the bank. < TOP >

24. A The right ans is commercial loan.. < TOP >

25. C Each bank lends only the amount known as the commitment that it has agreed to make available. In common laws it is known as “several”. As such other banks are not legally bound to make up the difference. < TOP >

26. E Banks current their entire advances in three various ways based on all the choices. < TOP >

27. B The efficiency of a bank is not always reflected only by the size of its balance sheet but by the level lo return on assets .Diminution in the value of loan assets by it self will not make the asset NPA if other factors are met. < TOP >

Earning:   Approval pending.