Bank PO / Clerk / RBI — MCQ Practice Questions & Answers

Question 1

What is the Base Rate set by RBI as of 2024?

Accepted Answer

Correct answer: D. RBI no longer uses Base Rate — RBI discontinued Base Rate framework in October 2019 and replaced it with repo rate-based monetary transmission

Answer

A. 4.5%

Answer

B. 5.5%

Answer

C. 6.5%

Question 2

If the Repo Rate is 6.5% and Reverse Repo Rate is 6.25%, which statement is true?

Accepted Answer

Correct answer: B. Banks earn more on lending than they pay on deposits — Repo Rate is higher than Reverse Repo Rate, so banks earn more when lending to the central bank versus borrowing

Answer

A. Banks pay more interest on deposits than they earn on lending

Answer

C. Both rates are equal

Answer

D. The difference is irrelevant to banking operations

Question 3

A customer deposits ₹1,00,000 in a Fixed Deposit at 7% p.a. for 2 years with annual compounding. What is the final amount?

Accepted Answer

Correct answer: A. ₹1,14,490 — A = P(1 + r/100)^n = 1,00,000(1.07)^2 = 1,00,000 × 1.1449 = ₹1,14,490

Answer

B. ₹1,14,980

Answer

C. ₹1,15,490

Answer

D. ₹1,16,490

Question 4

In a bank's balance sheet, what does NPA (Non-Performing Asset) refer to?

Accepted Answer

Correct answer: B. Loans where payments are overdue by 90+ days — NPA is a classification for loans where principal or interest payment is overdue by 90 days or more

Answer

A. New Product Advancement

Answer

C. Net Profit Amount

Answer

D. National Policy Agreement

Question 5

If a bank's CAR (Capital Adequacy Ratio) is 15%, what does this indicate?

Accepted Answer

Correct answer: D. Both A and C — CAR of 15% means the bank has adequate capital buffer. Regulatory minimum is 10.5%, so 15% indicates compliance and strength

Answer

A. The bank has ₹15 in capital for every ₹100 of assets

Answer

B. The bank is undercapitalized

Answer

C. The bank exceeds the minimum regulatory requirement

Question 6

What is the current Statutory Liquidity Ratio (SLR) requirement set by RBI as per 2024-2025?

Accepted Answer

Correct answer: B. 18% — As of 2024, RBI maintains SLR requirement at 18% of Net Demand and Time Liabilities (NDTL)

Answer

A. 15%

Answer

C. 20%

Answer

D. 25%

Question 7

If a bank's Net Interest Margin (NIM) increased from 2.8% to 3.2%, what does this signify?

Accepted Answer

Correct answer: B. The bank's profitability has improved — An increase in NIM indicates the bank is earning more profit on its lending and deposit operations

Answer

A. The bank's profitability has decreased

Answer

C. The bank's lending has decreased

Answer

D. There is no impact on profitability

Question 8

What does the term 'Markdown' mean in banking context?

Accepted Answer

Correct answer: C. The difference between buying and selling price of securities — Markdown refers to the spread between the bid-ask prices in securities trading by banks

Answer

A. Reduction in interest rates on deposits

Answer

B. A discount offered by the bank on services

Answer

D. A penalty charged by RBI

Bank PO / Clerk / RBI - MCQ Practice Questions