Money & Banking Answer the following question
1. What is the main function of money in an economy?
2. Name the System of Note-issue in India.
3. Define open Market operation.
4. Name the additional facility which the businessman
gets in the current deposit account of the bank.
5. Money acts as a yardstick of standard measure of
value to which all other things can be compared.
Discuss it.
6. The central bank acts as lender of last resort. How?
7. Central bank performs the function of a clearing
house. How?
8. All the currency issued by the central bank is its
monetary liability. How?
9. What is margin requirement of loans?
10. What do you mean by credit/money creation?
Explain the process of Money creation by the
commercial banks with the help of a
numerical example.

cognitive overload: having a lot on your mind impairs decision-making and tends to result in the simplest, but not necessarily best, option being selected.

empathy gaps: overlooking how you might feel in a different situation can result in unnecessary purchases, such as overbuying when shopping for food on an empty stomach.

optimism and overconfidence: wearing rose-tinted glasses and having unrealistic expectations about the future can affect money management and leave you unprepared for a change in circumstance.

instant gratification: seeking instant gratification drives impulsive spending and can undermine long-term planning and savings.

harmful habits: automatic or mindless behaviour can amplify a poor financial decision as it becomes a recurring event.

social norms: we are heavily influenced by the actions of others; while this can be in certain circumstances, it also contributes to the pressure to keep up with the joneses through conspicuous consumption.