Money and Credit Online Test 9th Social Science Lesson 11 Questions in English

During his rule (1540-1546) Sher Shah Suri set up a new civic and military administration and issued a coin of silver weighing 178 grams, which was termed the Rupiya. The silver coin remained in use during the Mughal period, the Maratha era and in British India as well.

The first form of trade was Barter system. The barter system flourished wherever civilizations thrived. This system was active not only within a civilization, but also among civilizations. This was the initial form of international trade.

Gold, silver and copper were the metals used first as currency. They were called ancient currency. Leather, beads, shells, tobacco, salt, corn and even slaves were exchanged as barter, says economists.

The metals such as silver and gold gained importance gradually all over the world. So, these metals were used as standard value in the exchange of goods. This was called as natural money.

king Alyattes of Lydia announced publicly that official currency will be used for Trade in 600 B.C. Lydia is region in Turkey. This transaction spread throughout Mediterranean.

Paper money spread to Europe through the travels of Marco Polo (1290)

In 1250 A.D. The Florin, Gold plate coin was introduced in Europe. When new paper money was printed in Sweden (1661) it was not much welcomed.

In the year 1860 through Telegram an effort was undertaken to transfer money electronically.

In the year 1946 John Biggins invented the credit card. European Banks introduced Mobile Banking in 1999 A.D.

Near Field Communication (NFC) was introduced in Britain. In 2016 it came to India. It takes only about 7 to 8 seconds to transact money through NFC.

The Reserve Bank of India started its operations on 1st April 1935. 7. RBI was Nationalised in 1949.

The Reserve Bank of India was permanently moved to Mumbai from the year 1937.

85% of the printed currency is let for circulation. According to the statistics available as on August 2018, currency worth of 19 lakh crore are in circulation. (source - Reserve Bank of India)

Dr B.R. Ambedkar’s Ph.D. Thesis on ‘The Problem of the Rupee - Its origin and solution’ was the reference tool and provided guidelines for the Reserve Bank of India Act of 1934.

There is a close relationship between volume of circulation money and the price of things. 90% of the products are manufactured with the main aim of sales or meant for services.

India – Rupee; England – Pound; European Union – Euro; Canada – Dollar; Japan – Yen; China – Yuan; Saudi Arabia – Riyal; Australia – Dollar; Malaysia –Ringgit; Pakistan – Rupee; Sri Lanka – Rupee.

Money should be accepted liberally in exchange of goods and services in a country. Money is used as a store of purchasing power. It can be used to finance future payments. Money should be the common, standard unit of calculating a country’s total consumer goods, products, services etc.

Purchasing capacity of all currencies in the world are compared using the US dollar as the standard currency. This value differs from country to country. Most of the international trade transactions are carried out in US dollar.

The relationship between money and price is connected with the Monetary policy. There is a close relationship between the growth of money supply and inflation. Price controls play a very important role in a country’s economic stability. This role is played by the Central Bank of our country, RBI in India.

Informal financial institutions are easily approachable to the customers with flexible procedures. But there are issues like the safety of items pledged high rates of interest and modes of recovery.

In Tamil Nadu, all the banks have 10,612 branches, across the state They carry on a total transaction of around 15 lakh crore rupees during the financial year (2017-2018).

One rupee and two Rupee notes were first printed in India in the year 1917. The Reserve Bank of India is empowered to issue the Government of India notes since1935. 500 Rupee note currency was introduced later.

In 1940, one Rupee notes were issued again. Till 1947, the currency notes with the image of King George VI were in circulation. After Independence, the Government of India issued currency notes.

In 1925, the British government established a government press at Nasik in Maharashtra. Currencies were printed three years later.

In 1974, a press was started in Dewas, Madhya Pradesh. (Security Printing and Minting Corporation of India Ltd.) In the 1990s. two more presses were started in Mysuru, Karnataka and Salboni in West Bengal to print bank notes.

The Reserve Bank of India has the authority to decide the value of currency to be printed and how the amount should reach its destination safely.

The RBI has the power to print up to ten thousand Rupee notes, at present a maximum of up-to rupees two thousand is printed.