MCQs on Money and Credit | Class 10 SST Economics Chapter 3

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Welcome to MCQ Assam School. This post contains 30 MCQs (Multiple Choice Questions) on Class 10 Social Science (Economics) Chapter 3. The name of the chapter is “Money and Credit”. So, basically, this post contains 30 MCQs on Money and Credit. These MCQs will help you to understand the chapter better and will also help you prepare for your exam.

MCQs on Class 10 SST Economics Chapter 3 Money and Credit

The Chapter deals with the following topics:

Money as a Medium of Exchange
Modern Forms of Money
Loan Activities of Bank
Terms of Credit
Formal Sector Credit in India, etc.

These MCQs can also act as a Mock Test. There are 30 MCQs. There are four options for each question. Out of the four options, only one option is correct. Choose the correct options for each question and click on the submit button to see the results. You can also, review your answers. For each right option, you will see a green check mark and for each wrong option, you will see a red cross mark. If the chosen option is wrong then a green check mark will appear near the right option. This way you will know the right answer.

Let’s begin.

30 MCQs on Money and Credit Class 10 SST Economics Chapter 3

1. What system requires a double coincidence of wants?

A. Money system B. Barter system C. Banking system D. Credit system

2. Which of the following is considered modern forms of money?

A. Barter goods B. Currency and deposits C. Gold and silver D. Services

3. What is the main function of banks?

A. Printing money B. Accepting deposits and providing loans C. Selling goods D. Producing goods

4. What term describes the money deposited in banks that can be withdrawn on demand?

A. Fixed deposits B. Recurring deposits C. Demand deposits D. Savings deposits

5. What is the primary purpose of credit?

A. To deposit money B. To save money C. To produce goods D. To provide loans for borrowing

6. Which sector provides loans at regulated interest rates?

A. Informal sector B. Formal sector C. Private moneylenders D. Traders and employers

7. What term describes the agreements that specify interest rate and terms of repayment?

A. Deposits B. Terms of credit C. Insurance D. Banking agreements

8. Which sector includes SHGs providing credit to the poor?

A. Formal sector B. Informal sector C. Banking sector D. Cooperative sector

9. What was the major step taken by the government in 2016 to promote digital transactions?

A. Increase in interest rates B. Launch of new banking schemes C. Introduction of new currency notes D. Demonetisation

10. What term describes the system where money is used to exchange goods and services?

A. Barter system B. Money system C. Banking system D. Credit system

11. Who provides informal sector loans with higher interest rates?

A. Banks and cooperatives B. Moneylenders and traders C. Government institutions D. Financial institutions

12. What is the role of Self-Help Groups (SHGs) in rural credit?

A. To promote savings B. To provide employment C. To provide credit to the poor D. To sell goods

13. What is the significance of availability of credit on reasonable terms?

A. To increase deposit rates B. To control inflation C. To promote inclusive growth and development D. To increase exports

14. What is the result of demonetisation on cash transactions?

A. Increase in cash transactions B. Decrease in cash transactions C. No effect D. Stabilization of cash transactions

15. Which type of deposits are held in banks that can be withdrawn anytime?

A. Fixed deposits B. Demand deposits C. Term deposits D. Recurring deposits

16. How do banks earn a profit?

A. By printing money B. By lending money at a higher interest rate C. By selling goods D. By providing services

17. What do banks offer on deposits?

A. Loans B. Services C. Interest D. Goods

18. What does the availability of credit promote?

A. Economic development B. Increase in inflation C. Decrease in exports D. Increase in imports

19. What is the main drawback of informal sector loans?

A. Lower interest rates B. Higher interest rates C. Easy repayment terms D. Government regulations

20. How do Self-Help Groups help their members?

A. By promoting deposits B. By providing employment C. By selling goods D. By providing credit and financial assistance

21. What does the term ‘barter system’ refer to?

A. Use of currency for transactions B. Exchange of goods without money C. Depositing money in banks D. Loan activities by banks

22. Which of the following describes a double coincidence of wants?

A. Using money for transactions B. Mutual exchange of goods without money C. Banking operations D. Financial agreements

23. What do formal sector loans ensure?

A. High-interest rates B. Easy availability C. Regulated and lower interest rates D. Quick repayment

24. What was one of the main goals of demonetisation in 2016?

A. To increase the use of cash B. To introduce new currency notes C. To promote digital transactions D. To decrease the interest rates

25. Which sector is characterized by higher interest rates and fewer regulations?

A. Formal sector B. Informal sector C. Banking sector D. Cooperative sector

26. What type of loans do banks provide?

A. Unregulated loans B. Regulated and lower interest loans C. High-interest loans D. Informal loans

27. What does the term ‘demand deposits’ refer to?

A. Fixed deposits B. Recurring deposits C. Deposits that can be withdrawn anytime D. Term deposits

28. How do informal sector loans typically differ from formal sector loans?

A. Lower interest rates B. Easy terms of repayment C. Higher interest rates and fewer regulations D. Regulated and lower interest rates

29. What is the significance of Self-Help Groups in rural areas?

A. Providing credit and financial assistance B. Promoting deposits C. Selling goods D. Providing employment

30. What was one outcome of the demonetisation policy in 2016?

A. Decrease in digital transactions B. Increase in cash transactions C. Introduction of new currency notes D. Increase in digital transactions

Review Your Answers Above.

MCQs on Development | Class 10 SST Economics Chapter 1
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MCQs on Globalization and The Indian Economy | Class 10 SST Economics Chapter 4
MCQs Consumer Rights | Class 10 SST Economics Chapter 5

The Bottom Line

I hope these 30 Multiple-choice questions have helped you learn more about the Class 10 Social Science (Economics) Chapter 3 (Money and Credit) in detail. You can retake the test anytime you want by refreshing the page and review your results.

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Abdur Rohman

Abdur Rohman is an Electrical Engineer from Charaideo, Assam, who wears multiple hats as a part-time teacher, blogger, entrepreneur, and digital marketer. Passionate about education, he founded The Assam School blog to provide free, comprehensive textbook solutions, MCQs (Multiple Choice Questions), and other academic content for students from Class V to XII.

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