TRUE OR FALSE

1. Monetary system serves as guidelines to Banking Institution while Monetary standards serves as guidelines to all the institutions in the areas of banking, credit and money.

2. Monetary system rests on the hands of the monetary board.

3. Central Bank is an independent Government Agency.

4. The president holds the control of the monetary system and monetary board.

5. Monetary board is composed of the 7 undersecretary of the President.

6. Central Bank is an apex bank in an economy.

7. Central bank has little role in controlling and regulating the operations of commercial banks.

8. Central bank acts as banker to the government.

9. Central bank plays an important role in controlling and regulating money supply in an economy.

10. Quantitative methods of credit control influences the overall supply of money in an economy.

11. Increase in bank rate reduces supply of money in an economy.

12. During inflation the central bank increases bank rate and during deflation it reduces the bank rate.

13. During inflation the central bank starts purchasing securities in the market.

14. Selective credit control measures influence supply of money only in some sectors of the economy.

15. Credit rationing is an important form of selective credit control.