The Reserve Bank of India began its operations on which date?
- A.1 April 1935
- B.1 January 1949
- C.1 July 1955
- D.19 July 1969
Correct answer
Explanation
The correct answer is A, 1 April 1935. The Reserve Bank of India was constituted under the Reserve Bank of India Act of 1934, on the recommendation of the Hilton Young Commission, and started functioning on 1 April 1935 with its central office at Calcutta, which was shifted permanently to Bombay in 1937.
Option B, 1 January 1949, is the date on which the Reserve Bank was nationalised and passed from private shareholders to full government ownership, so it is a real date but answers a different question. Option C, 1 July 1955, is the date on which the Imperial Bank of India was converted into the State Bank of India. Option D, 19 July 1969, is the date on which fourteen large commercial banks were nationalised. All four dates appear together in option sets, so learn them as a group with the event attached to each.
Read the full article: Money and Banking in India: RBI, Supply and Policy
Practice Questions
View allIn the measurement of money supply in India, which aggregate is known as broad money?
- A.M0
- B.M1
- C.M3
- D.M4
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M3 is M1 plus time deposits with banks, and it is called broad money or the aggregate monetary resource. It is the measure the Reserve Bank follows most closely because it captures both spendable balances and funds held for a fixed term.
Read the full explanation →The repo rate is the rate of interest at which
- A.Commercial banks lend to their prime customers
- B.The Reserve Bank lends short-term funds to banks against government securities
- C.The Reserve Bank borrows surplus funds from commercial banks
- D.Banks pay interest on savings deposits
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In a repurchase or repo transaction a bank sells government paper to the Reserve Bank and agrees to buy it back shortly afterwards at a slightly higher price; the difference works out as interest at the repo rate.
Read the full explanation →How many commercial banks were nationalised in India in the first round of bank nationalisation in July 1969?
- A.Six
- B.Twelve
- C.Fourteen
- D.Twenty
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On 19 July 1969 the government nationalised fourteen of the largest commercial banks in the country, the aim being to take banking to rural areas, direct credit to agriculture and small industry, and end the concentration of bank funds in a few business houses.
Read the full explanation →In India, the one rupee note is issued by
- A.The Reserve Bank of India
- B.The State Bank of India
- C.The Government of India
- D.The Security Printing and Minting Corporation
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The one rupee note and all coins are issued by the Government of India through the Ministry of Finance, and the one rupee note carries the signature of the Finance Secretary rather than that of the Governor of the Reserve Bank.
Read the full explanation →The Reserve Bank of India was nationalised in which year?
- A.1935
- B.1949
- C.1955
- D.1969
Show answer
The Reserve Bank began in 1935 as a shareholders' bank with privately held capital.
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