SEBA Class 10 Economics Chapter 1 MCQs – Money and Banking (2026–27)
SEBA Class 10 Economics Chapter 1 MCQs Money and Banking (2026–27) are carefully prepared by Assam Eduverse to help HSLC students score higher in Economics objective questions. As per the latest HSLC exam pattern, 45 MCQs are asked, making SEBA Class 10 Economics Chapter 1 MCQs Money and Banking a highly scoring chapter in Economics.
This chapter explains the meaning of money, functions of money, and the role of banking institutions in the economy. The SEBA Class 10 Economics Chapter 1 MCQs Money and Banking focus on types of money, credit creation, commercial banks, central bank functions, and importance of banking, which are frequently asked in HSLC examinations.
By practising these Class 10 SEBA Economics MCQ practice questions, students can improve conceptual clarity, accuracy, and exam confidence. This page also includes HSLC Economics Chapter 1 MCQs previous year questions along with extra objective questions for complete preparation for the HSLC 2026–27 Economics examination.
SEBA HSLC Class 10 Economics Chapter 1 MCQs – Money and Banking (45 MCQs Pattern)
Table of Contents
A. Previous Year MCQs Questions with Answers
Q.1 The State Bank of India is basically a — [HSLC 2010]
(a) Central Bank
(b) Commercial Bank
(c) Co-operative Bank
(d) Agricultural Development Bank
Answer: (b) Commercial Bank
Q.2 The Central Bank of India is — [HSLC 2011]
(a) State Bank of India
(b) Reserve Bank of India
(c) Union Bank of India
(d) United Bank of India
Answer: (b) Reserve Bank of India
Q.3 Of the following types of money the non-legal tender money is — [HSLC 2012]
(a) Paper money
(b) Cheque money
(c) Metallic money
(d) Fiat money
Answer: (b) Cheque money
Q.4 Which one of the following is an agricultural development bank? — [HSLC 2013]
(a) NABARD
(b) RBI
(c) SBI
(d) IDBI
Answer: (a) NABARD
Q.5 Which one of the following banks was first set up in India in 1770? — [HSLC 2017]
(a) Reserve Bank of India
(b) Bank of Hindustan
(c) Industrial Development Bank of India
(d) Small Industrial Development Bank of India
Answer: (b) Bank of Hindustan
Q.6 Which one of the following Central Banks is the world’s oldest Central Bank? — [HSLC 2018]
(a) Bank of Hindustan
(b) Riksbank of Sweden
(c) Reserve Bank of India
(d) Bank of Venice
Answer: (b) Riksbank of Sweden
Q.7 The five stages in the process of evolution of money are — [HSLC 2023]
(a) Paper money → Coinage → Metallic Standard → Animal Standard → Barter System
(b) Barter System → Animal Standard → Metallic Standard → Coinage → Paper Money
(c) Barter System → Paper Money → Metallic Standard → Animal Standard → Coinage
(d) Animal Standard → Metallic Standard → Coinage → Barter System → Paper Money
Answer: (b) Barter System → Animal Standard → Metallic Standard → Coinage → Paper Money
Q.8 Which of the following financial institutions was made operational since 1990 to promote modernisation, expansion and to create markets for the products of the small industries in India? [HSLC 2023]
(a) National Bank for Agriculture and Rural Development (NABARD)
(b) Small Industries Development Bank of India (SIDBI)
(c) Regional Rural Banks (RRBs)
(d) Life Insurance Corporation of India (LIC)
Answer: (b) Small Industries Development Bank of India (SIDBI)
Q.9 The duration of a financial year in India is — [HSLC 2023]
(a) January 1 to December 31
(b) February 1 to January 31
(c) March 1 to February 28/29
(d) April 1 to March 31
Answer: (d) April 1 to March 31
Q.10 Which of the following alternatives are characteristics of money? — [HSLC 2024]
(i) General acceptability (ii) Homogeneity (iii) Liquidity (iv) Stability of value
(A) (i), (ii), (iv)
(B) (ii), (iii), (iv)
(C) (i), (iii), (iv)
(D) (i), (ii), (iii), (iv)
Answer: (D) (i), (ii), (iii), (iv)
Q.11 Identify two primary functions of money — [HSLC 2024]
(i) Medium of exchange (ii) Standard of value (iii) Deferred payment (iv) Store of value
(A) (i) and (ii)
(B) (i) and (iii)
(C) (iii) and (iv)
(D) (ii) and (iv)
Answer: (A) (i) and (ii)
Q.12 The name of the Central Bank of India is — [HSLC 2024]
(A) State Bank of India
(B) Bank of Hindustan
(C) Reserve Bank of India
(D) United Bank of India
Answer: (C) Reserve Bank of India
Q.13 Which of the following is not a function of commercial banks? — [HSLC 2024]
(A) Mobilises savings
(B) Offers loans
(C) Creates credit money
(D) Issues paper currency
Answer: (D) Issues paper currency
Q.14 Identify the incorrect statements relating to cheque money — [HSLC 2025]
(i) General acceptability (ii) Legal obligation (iii) Generated through offence (iv) Claim against money (v) Printed by Central Bank
(a) (i), (ii), (iii), (v)
(b) (i), (ii), (iv), (v)
(c) (ii), (iii), (iv), (v)
(d) (i), (iii), (iv), (v)
Answer: (a) (i), (ii), (iii), (v)
Q.15 Romen opens an account in Allahabad Bank with a sum of Rupees twenty thousand (₹20,000). After three months of opening, he again deposits ₹3,000 in his account. At the end of the financial year, bank credits a sum of ₹550 as interest. Considering the above situation, choose the type of bank account Romen has. [HSLC 2025]
(a) Current Deposit Account
(b) Fixed Deposit Account
(c) Recurring Deposit Account
(d) Savings Deposit Account
Answer: (d) Savings Deposit Account
Q.16 Assertion–Reason — [HSLC 2025]
Assertion (A): Money is the most liquid asset.
Reason (R): Money can be directly converted into goods and services.
(a) Both (A) and (R) are true and (R) is the correct explanation
(b) Both are true but (R) is not the correct explanation
(c) (A) is true, (R) is false
(d) (A) is false, (R) is true
Answer: (a) Both (A) and (R) are true and (R) is the correct explanation
B. Extra HSLC Pattern MCQs Questions with Answers
Q.1 Money is generally acceptable because—
(a) It is durable
(b) It has legal backing
(c) It is divisible
(d) It is homogeneous
Answer: (b) It has legal backing
Q.2 Barter system suffers mainly due to—
(a) Lack of money
(b) Indivisibility of commodities
(c) Excess production
(d) Overpopulation
Answer: (b) Indivisibility of commodities
Q.3 Which of the following is the first stage in the evolution of money?
(a) Animal Standard
(b) Metallic Standard
(c) Barter System
(d) Coinage
Answer: (c) Barter System
Q.4 The stage in which goats were used as money is known as—
(a) Metallic standard
(b) Animal standard
(c) Coinage
(d) Paper money
Answer: (b) Animal standard
Q.5 Metallic standard mainly used—
(a) Iron and copper
(b) Gold and silver
(c) Nickel and tin
(d) Aluminium and zinc
Answer: (b) Gold and silver
Q.6 Paper money is accepted as money because—
(a) It is made of paper
(b) It has intrinsic value
(c) It has legal authority
(d) It is easily printable
Answer: (c) It has legal authority
Q.7 Which one is NOT a characteristic of money?
(a) Liquidity
(b) Durability
(c) Perishability
(d) Homogeneity
Answer: (c) Perishability
Q.8 Liquidity of money means—
(a) Stability of value
(b) Easy storage
(c) Immediate convertibility into goods
(d) Legal acceptability
Answer: (c) Immediate convertibility into goods
Q.9 Money acts as a medium of exchange because—
(a) It stores value
(b) It measures value
(c) It facilitates buying and selling
(d) It is durable
Answer: (c) It facilitates buying and selling
Q.10 Which of the following is a primary function of money?
(a) Store of value
(b) Standard of deferred payments
(c) Medium of exchange
(d) Transfer of income
Answer: (c) Medium of exchange
Q.11 Which of the following are disadvantages of barter system?
(i) Lack of double coincidence of wants
(ii) Indivisibility of commodities
(iii) Lack of store of value
(iv) High liquidity
(A) (i), (ii), (iii)
(B) (ii), (iii), (iv)
(C) (i), (iii), (iv)
(D) (i), (ii), (iv)
Answer: (A) (i), (ii), (iii)
Q.12 Which of the following are characteristics of money?
(i) Durability
(ii) Liquidity
(iii) Divisibility
(iv) Perishability
(A) (i), (ii), (iii)
(B) (ii), (iii), (iv)
(C) (i), (iii), (iv)
(D) (i), (ii), (iv)
Answer: (A) (i), (ii), (iii)
Q.13 Which of the following are secondary functions of money?
(i) Store of value
(ii) Standard of deferred payments
(iii) Medium of exchange
(iv) Measure of value
(A) (i) and (ii)
(B) (iii) and (iv)
(C) (i) and (iii)
(D) (ii) and (iv)
Answer: (A) (i) and (ii)
Q.14 Match List A with List B:
List A | List B
(i) Fiat money | (a) Claim against money
(ii) Cheque | (b) Backed by state authority
(iii) Token money | (c) Face value greater than intrinsic value
(A) (i)-(b), (ii)-(a), (iii)-(c)
(B) (i)-(a), (ii)-(b), (iii)-(c)
(C) (i)-(c), (ii)-(a), (iii)-(b)
(D) (i)-(b), (ii)-(c), (iii)-(a)
Answer: (A) (i)-(b), (ii)-(a), (iii)-(c)
Q.15 Match the following:
List A | List B
(i) Central Bank | (a) Mobilises savings
(ii) Commercial Bank | (b) Issues currency
(A) (i)-(b), (ii)-(a)
(B) (i)-(a), (ii)-(b)
(C) (i)-(b), (ii)-(b)
(D) (i)-(a), (ii)-(a)
Answer: (A) (i)-(b), (ii)-(a)
Q.16 Assertion (A): Money is divisible.
Reason (R): Money can be used for transactions of all values.
(a) Both (A) and (R) are true and (R) explains (A).
(b) Both (A) and (R) are true but (R) does not explain (A).
(c) (A) is true, (R) is false.
(d) (A) is false, (R) is true.
Answer: (a) Both (A) and (R) are true and (R) explains (A).
Q.17 Assertion (A): Cheque is legal tender money.
Reason (R): Refusal to accept cheque violates law.
(a) Both true
(b) Both false
(c) (A) true, (R) false
(d) (A) false, (R) true
Answer: (b) Both false
Q.18 Arrange the stages of evolution of money in correct order:
(i) Coinage
(ii) Barter System
(iii) Paper Money
(iv) Metallic Standard
(A) (ii), (iv), (i), (iii)
(B) (iv), (ii), (i), (iii)
(C) (ii), (i), (iv), (iii)
(D) (i), (ii), (iv), (iii)
Answer: (A) (ii), (iv), (i), (iii)
Q.19 Legal tender money is backed by—
(a) Banks
(b) Market
(c) Law
(d) Society
Answer: (c) Law
Q.20 Unlimited legal tender money can be used—
(a) Only for small transactions
(b) Only in banks
(c) For transactions of any value
(d) Only by government
Answer: (c) For transactions of any value
Q.21 Cheque money is—
(a) Commodity money
(b) Token money
(c) Claim against money
(d) Fiat money
Answer: (c) Claim against money
Q.22 Black money is generated through—
(a) Banking system
(b) Economic offence
(c) Trade surplus
(d) Foreign exchange
Answer: (b) Economic offence
Q.23 High power money is controlled by—
(a) Commercial banks
(b) Government
(c) Central Bank
(d) NABARD
Answer: (c) Central Bank
Q.24 The Central Bank of India was set up in—
(a) 1926
(b) 1935
(c) 1947
(d) 1956
Answer: (b) 1935
Q.25 The Central Bank acts as banker’s bank because—
(a) It accepts public deposits
(b) It issues loans to farmers
(c) It maintains accounts of banks
(d) It trades currency
Answer: (c) It maintains accounts of banks
Q.26 Which bank mobilises rural savings?
(a) RBI
(b) NABARD
(c) RRB
(d) SIDBI
Answer: (c) RRB
Q.27 NABARD mainly deals with—
(a) Industrial finance
(b) Urban development
(c) Rural credit
(d) Foreign trade
Answer: (c) Rural credit
Q.28 SIDBI mainly supports—
(a) Agriculture
(b) Small industries
(c) Large industries
(d) Foreign banks
Answer: (b) Small industries
Q.29 Savings deposit allows—
(a) No withdrawal
(b) Partial withdrawal
(c) Fixed withdrawal only
(d) Unlimited withdrawal anytime
Answer: (b) Partial withdrawal
Q.30 Credit creation is a function of—
(a) Central Bank only
(b) NABARD
(c) Commercial banks
(d) Government
Answer: (c) Commercial banks
Q.31 The main objective of a bank is to—
(a) Print currency
(b) Mobilise savings and give loans
(c) Control prices
(d) Regulate trade
Answer: (b) Mobilise savings and give loans
Q.32 Which institution is known as the banker’s bank?
(a) Commercial Bank
(b) Cooperative Bank
(c) Central Bank
(d) Regional Rural Bank
Answer: (c) Central Bank
Q.33 The monopoly right of issuing currency lies with—
(a) Commercial Banks
(b) Government
(c) Central Bank
(d) NABARD
Answer: (c) Central Bank
Q.34 Which of the following is a non-legal tender money?
(a) Paper money
(b) Coin
(c) Cheque
(d) Token money
Answer: (c) Cheque
Q.35 Token money means—
(a) Money with intrinsic value
(b) Money backed by gold
(c) Money whose face value exceeds intrinsic value
(d) Commodity used as money
Answer: (c) Money whose face value exceeds intrinsic value
Q.36 Which of the following are functions of the Central Bank?
(i) Issue of currency
(ii) Control of credit
(iii) Accept deposits from public
(iv) Banker to government
(A) (i), (ii), (iv)
(B) (i), (iii), (iv)
(C) (ii), (iii), (iv)
(D) (i), (ii), (iii)
Answer: (A) (i), (ii), (iv)
Q.37 Which of the following are types of deposits in commercial banks?
(i) Current deposit
(ii) Fixed deposit
(iii) Savings deposit
(iv) Foreign deposit
(A) (i), (ii), (iii)
(B) (ii), (iii), (iv)
(C) (i), (iii), (iv)
(D) (i), (ii), (iv)
Answer: (A) (i), (ii), (iii)
Q.38 Match List A with List B:
List A | List B
(i) NABARD | (a) Small industries
(ii) SIDBI | (b) Rural development
(iii) RRB | (c) Villagers
Options:
(A) (i)-(b), (ii)-(a), (iii)-(c)
(B) (i)-(a), (ii)-(b), (iii)-(c)
(C) (i)-(c), (ii)-(a), (iii)-(b)
(D) (i)-(b), (ii)-(c), (iii)-(a)
Answer: (A) (i)-(b), (ii)-(a), (iii)-(c)
Q.39 Assertion (A): Money acts as a store of value.
Reason (R): Money has durability.
(a) Both (A) and (R) are true and (R) explains (A).
(b) Both (A) and (R) are true but (R) does not explain (A).
(c) (A) is true, (R) is false.
(d) (A) is false, (R) is true.
Answer: (a) Both (A) and (R) are true and (R) explains (A).
Q.40 Assertion (A): Barter system broke down over time.
Reason (R): It lacked a common unit of account.
(a) Both (A) and (R) are true and (R) explains (A).
(b) Both (A) and (R) are true but (R) does not explain (A).
(c) (A) is true, (R) is false.
(d) (A) is false, (R) is true.
Answer: (a) Both (A) and (R) are true and (R) explains (A).
Q.41 Arrange the following banks according to their field of operation:
(i) SIDBI
(ii) NABARD
(iii) RRB
(A) Small industries → Rural development → Villagers
(B) Villagers → Small industries → Rural development
(C) Rural development → Small industries → Villagers
(D) Small industries → Villagers → Rural development
Answer: (A) Small industries → Rural development → Villagers
Q.42 Dear money policy means—
(a) Lower rate of interest
(b) Higher rate of interest
(c) More credit availability
(d) Increase in money supply
Answer: (b) Higher rate of interest
Q.43 Cheap money policy results in—
(a) Reduced borrowing
(b) Higher interest rate
(c) Increased borrowing
(d) Credit contraction
Answer: (c) Increased borrowing
Q.44 Which of the following is NOT a drawback of money?
(a) Encourages corruption
(b) Concentration of wealth
(c) Erosion of values
(d) Removes barter difficulties
Answer: (d) Removes barter difficulties
Q.45 Stability of value is important because—
(a) Money can be printed easily
(b) Money can be exchanged
(c) Money can store value
(d) Money can circulate
Answer: (c) Money can store value
Q.46 Which institution transfers RBI’s rural credit functions?
(a) SIDBI
(b) RRB
(c) NABARD
(d) IDBI
Answer: (c) NABARD
Q.47 Commercial banks generally avoid—
(a) Short-term loans
(b) Medium-term loans
(c) Long-term loans
(d) Savings deposits
Answer: (c) Long-term loans
Q.48 Credit creation starts when banks—
(a) Accept deposits
(b) Issue currency
(c) Offer loans
(d) Open accounts
Answer: (c) Offer loans
Q.49 Money of account means—
(a) Physical money
(b) Abstract measurement of value
(c) Paper currency only
(d) Coinage system
Answer: (b) Abstract measurement of value
Q.50 Which of the following best defines money?
(a) Anything valuable
(b) Anything acceptable as gift
(c) Anything generally acceptable as a medium of exchange
(d) Anything printed by government
Answer: (c) Anything generally acceptable as a medium of exchange
SEBA Class 10 Economics Chapter 1 MCQs – Money and Banking
SEBA Class 10 Economics Chapter 1 MCQs Money and Banking are an essential study resource for HSLC students preparing for Economics MCQs. These SEBA Class 10 Economics Chapter 1 MCQs Money and Banking strictly follow the updated SEBA 2026–27 Economics syllabus and the latest 45 MCQs examination pattern, making SEBA Class 10 Economics Chapter 1 MCQs Money and Banking highly exam-oriented.
This page includes SEBA Class 10 Economics Chapter 1 MCQs Money and Banking covering the meaning and functions of money, types of money, and the role of banks. The SEBA Class 10 Economics Chapter 1 MCQs Money and Banking explain commercial banks, central bank functions, credit creation, and importance of banking, ensuring SEBA Class 10 Economics Chapter 1 MCQs Money and Banking remain concept-focused.
Students will also find HSLC Economics Chapter 1 MCQs previous year questions highlighting repeated Economics trends. Regular practice of SEBA Class 10 Economics Chapter 1 MCQs Money and Banking along with SEBA Economics Chapter 1 objective questions improves accuracy, understanding, and Economics exam readiness.
If you are searching for reliable and updated SEBA Class 10 Economics Chapter 1 MCQs Money and Banking, this content prepared by Assam Eduverse will help you revise monetary concepts effectively and score higher using SEBA Class 10 Economics Chapter 1 MCQs Money and Banking.
FAQs – SEBA Class 10 Economics Chapter 1 MCQs
1. Are these SEBA Class 10 Economics Chapter 1 MCQs based on the latest HSLC exam pattern?
Yes, these SEBA Class 10 Economics Chapter 1 MCQs Money and Banking follow the latest 45 MCQs HSLC Economics exam pattern.
2. Does this page include HSLC Economics Chapter 1 MCQs previous year questions?
Yes, this page includes HSLC Economics Chapter 1 MCQs previous year along with extra objective questions.
3. Is Money and Banking important for Economics MCQs?
Yes, Money and Banking is a very important chapter and MCQs are frequently asked from this topic in HSLC Economics examinations.
4. Are these MCQs useful for Class 10 SEBA Economics exam preparation?
Yes, these SEBA Economics Chapter 1 objective questions are ideal for Economics exam preparation and revision.
5. Are these Economics MCQs chapterwise?
Yes, all SEBA Class 10 Economics Chapter 1 MCQs are strictly chapterwise.
6. Are these MCQs updated for HSLC 2026–27 Economics examination?
Yes, these SEBA Class 10 Economics Chapter 1 MCQs Money and Banking are fully updated for HSLC 2026–27 Economics exams.
7. Who prepared these Economics Chapter 1 MCQs?
These Economics MCQs are prepared by subject experts of Assam Eduverse following SEBA Economics guidelines.
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