XII Banking

Note: Attempt any Five questions.All questions carry equal marks.

1.a) Describe the advantages and disadvantages of Barter System.(12)
b) Discuss briefly the Evolution of Money.(8)

2.a) State the advantages and disadvantages of paper Money.(8)
b) Explain the Purchasing power Parity Theory and write down its assumptions and defects.(12)

3.a) Define Bimetallism.Discuss the merits and demerits of Bimetallism.(10)
b) What are the different forms of Gold Standard? (10)

4.a) Explain in detail the various uses of Bank Funds.(12)
b) How does a bank create credit? (8)

5.a) Describe the functions of a Central Bank.(10)
b) Define a Commercial Bank.Explain its any five important functions.(10)

6.a) What are Credit Instruments? Give examples.(5)
b) Define Bill of Exchange.List its essentials.(5)
c) Describe the various methods of crossing a cheque.(10)

7.a) How is Rate of Exchange determined? (4)
b) Define and briefly describe the Gresham’s Law.(6)
c) Distinguish between Balance of Trade and Balance of Payments.(10)

8. Write short notes on any Two of the following:(20)
i) Kinds of Endorsement of a Cheque.
ii) Secured Advance and Unsecured Advances.
iii) Legal Tender Money.
iv) Bank Draft and pay order.

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