Dear Readers, Bank Exam Race for the Year 2018 is already started, To enrich your preparation here we have providing new series of Practice Questions on English language – Section. Candidates those who are preparing for IBPS Clerk Prelims 2018 Exams can practice these questions daily and make your preparation effective.
[WpProQuiz 4472]Direction (1-10): Read the passage carefully and answer the following questions.
When we talk about any market it comes to our mind that a market consists of many shops, outlets, stalls, hawkers and now newly developed markets known as malls. Very obvious all these are essential parts of any market but when we talk about Money Market means that there are hundreds of shops selling money.
No doubt there are such places also where we see the currency notes and coins piled up on a table or counter but all these shops of money are just dealing in exchange of money on two accounts- First they deal with exchanging old, torn, mutilated , and such currency notes which are not usually accepted by common shopkeepers.
The money market is entirely different where no visible shops are counters exist.
It comprises of different types of companies, institutions, firms, individuals who are either in need of money or are having surplus money. The entities in need of money seek financial help from this market against some payables and the entities having surplus funds, deploy their surplus money in gainful way.
Money market basically refers to a section of the financial market where financial instruments with high liquidity and short-term maturities are traded. Money market is that component of the financial market which is used for buying and selling of securities of short-term maturities, of one year or less.
Money market instruments offer low risk, their returns are significantly lower than those of other securities.
Withdrawing money from the money market is easier. Money markets are different from capital markets as they are for a shorter period of time while capital markets are used for longer time periods.
The money market is used by a wide array of participants, from a company raising money by selling commercial paper into the market to an investor purchasing Certificate of Deposits as a safe place to park money in the short term.
Money market consists of two sectors- organized sector comprising the Reserve Bank of India and commercial banks, and unorganized sector having an indigenous stint.
The functions and activities of organized sector of money market are coordinated by the RBI.
The organized sector of the Indian money market can be divided into sub-markets.
The call money market (CMM) is the market where overnight (one day) loans can be availed by banks to meet liquidity. Banks who seek to avail liquidity, approach the call market as borrowers and the ones who have excess liquidity, participate there as lenders.
Call Money Market is the main market oriented mechanism to meet the liquidity requirements of banks. Call Money refers to the borrowing or lending of funds for 1 day. Notice Money refers to the borrowing and lending of funds for 2-14 days and Term money refers to borrowing and lending of funds for a period of more than 14 days.
Treasury bill market is the market for the sale and purchase of short term government securities. These securities are called treasury bills which are promissory notes or financial bills issued by RBI on behalf of the government of India. In other words, it can be said that when government goes to the financial market to raise money, it can do it by issuing two types of debt instruments – treasury bills and government bonds. Treasury bills are issued when the government need money for a shorter period while bonds are issued when it need debt for more than say five years.
Market for the Certificate of Deposit (CDs) again an important segment of Indian money market. It is issued by the commercial bank. A certificate of deposit is an agreement to deposit money for a fixed period with a bank that will pay you interest.
Market for the commercial papers is the market where commercial papers are traded.Commercial paper is an unsecured, short-term debt instrument issued by a corporate house, have working capital more than or equal to rupees 5 crore. It is typically issued for the financing of accounts payable and inventories, and meeting short-term liabilities.
The money market plays an important part in the economy of every nation and has specific role particularly in short term financing. It helps in maintaining balance between demand and supply of short term monetary transactions.
Money market plays a very important role by making funds available to many units or entities engaged in diversified field of activities be it agriculture, industry, trade, commerce or any other business.
By providing funds to developing sectors it helps in growth of economy also.
No doubt it provides a base for the implementation of monetary policy also. The money market provides opportunity for short term investments.
Money market is integral part of financial market where instruments of high liquidity with very short period of maturity are traded. The money circulated throughout the money market, finances short-term borrowing by large corporations and the government. This borrowing allows both businesses and government agencies to continue to spend the money on programs and expansion projects necessary to encourage economic growth.
1) According to the passage, in order to meet their liquidity requirements, banks reach which of the following markets?
a) treasury bill market
b) commercial bill market
c) call money market
d) commercial paper market
e) short term loan market
2) According to the passage, which of the following functions, is not played by the money market?
a) provide opportunity for short term investment
b) discounting bill of exchange
c) promote the growth of the economy
d) provide base for implementing monetary policy
e) make funds available to business units
3) According to the passage, which of the followings is not the feature of money market?
a) easy withdrawal of money
b) high liquidity
c) lower return
d) lower risk
e) securities of long term maturities
4) According to the passage, for financing its short term liabilities, which of the following instruments can be used by the business house?
a) bond
b) treasury bill
c) fixed deposit
d) commercial paper
e) certificate of deposit
5) Which of the following statements is true in the context of the passage?
a) Certificate of deposit is issued by listed company or business firm.
b) Money market instruments offer higher risk.
c) Notice Money refers to the borrowing and lending of funds for 2-14 days.
d) None of the above
e) All are true
6) Find the incorrect statement on the basis of the given passage.
a) The money market plays an important part in the economy of every nation
b) Commercial paper is an unsecured, short-term debt instrument.
c) Listed companies are the only participants of money market.
d) The functions and activities of organized sector of money market are coordinated by the RBI.
e) All are correct
7) Choose the word which as same meaning as the word “torn”
a) seamless
b) pristine
c) tattered
d) immaculate
e) intact
8) Choose the word which as same meaning as the word “organized”
a) muddled
b) structured
c) chaotic
d) tangled
e) cluttered
9) Choose the word which as opposite meaning as the word “diversified”
a) swelled
b) split off
c) branched out
d) inflated
e) unvaried
10) Choose the word which as opposite meaning as the word “surplus”
a) superfluous
b) surfeit
c) slippage
d) redundant
e) plethora
Answers:
1) Answer: c)
It is mentioned in the passage that the call money market (CMM) is the market where overnight (one day) loans can be availed by banks to meet their liquidity requirements.
2) Answer: b)
According to the passage, money market does not provide the facility of discounting the bill of exchange as it is not mentioned in the passage.
3) Answer: e)
According to the passage, ‘securities of long term maturities’ is not the feature of money market as it is given in the passage that money market basically refers to a section of the financial market where financial instruments with high liquidity and short-term maturities are traded.
4) Answer: d)
It is given in the passage that Commercial paper is an unsecured, short-term debt instrument issued by a corporate house for the financing of accounts payable and inventories, and meeting short-term liabilities.
5) Answer: c)
According to the passage true statement is “Notice Money refers to the borrowing and lending of funds for 2-14 days.”
6) Answer: c)
It is mentioned in the passage that money market is used by a wide array of participants, from a company raising money by selling commercial paper into the market, to an investor purchasing Certificate of Deposits as a safe place to park money in the short term.
7) Answer: c)
The meaning of “torn” is “ragged /worn out”.
8) Answer: b)
The meaning of “organized” is “structured / prearranged”.
9) Answer: e)
The meaning of “diversified” is “split off/ branched out” and its opposite is “concentrated /unvaried”.
10) Answer: c)
The meaning of “surplus” is “plethora / superfluous” and its opposite is “deficit/ slippage”.
Daily Practice Test Schedule | Good Luck
| Topic | Daily Publishing Time |
| Daily News Papers & Editorials | 8.00 AM |
| Current Affairs Quiz | 9.00 AM |
| Current Affairs Quiz (Hindi) | 9.30 AM |
| IBPS Clerk Prelims – Reasoning | 10.00 AM |
| IBPS Clerk Prelims – Reasoning (Hindi) | 10.30 AM |
| IBPS Clerk Prelims – Quantitative Aptitude | 11.00 AM |
| IBPS Clerk Prelims – Quantitative Aptitude (Hindi) | 11.30 AM |
| Vocabulary (Based on The Hindu) | 12.00 PM |
| IBPS Clerk Prelims – English Language | 1.00 PM |
| SSC Practice Questions (Reasoning/Quantitative aptitude) | 2.00 PM |
| IBPS Clerk – GK Questions | 3.00 PM |
| SSC Practice Questions (English/General Knowledge) | 4.00 PM |
| Daily Current Affairs Updates | 5.00 PM |
| Canara Bank PO Mains – Reasoning | 6.00 PM |
| Canara Bank PO Mains – Quantitative Aptitude | 7.00 PM |
| Canara Bank PO Mains – English Language | 8.00 PM |
This post was last modified on December 1, 2018 12:54 pm