Ag Econ 3.2
Question Bank
AGRICULTURAL FINANCE AND COOEPRATION
(AG. ECON 3.2)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
Under single window system, cooperative marketing is under ______ tier
structure
(A) One
(B) Two
(C) Three
(D) Four
Loans obtained from pawn broken by pledging movable property are
called _________loans
(A)Term
(B) Production
(C) Chattal
(D)All
The number of banks nationalized so far are
(A) 9
(B) 14
(C) 30
(D) 20
NABARD took over the function of
(A) ACD
(B) ARDC
(C) RPCC
(D)All
FSS on cooperative lines are recommended by
(A) Bawa team
(B) NCA
(C) Royal commission on
(D) Gadgil committee
agriculture
RRBs share capital is being subscribed by the central government, State
government and sponsoring bank in the ratio of
(A) 50:15:35
(B) 50:35:15
(C) 50:25:25
(D)50:40:10
Loans advanced to the agro-input manufacturing industries are called
(A) Open
(B) Key
(C) Direct
(D)Indirect
Key and Open loans are together called as _________ loans
(A) Mortgage
(B) Pledge
(C) Production
(D)Term
Single window system in cooperative credit structure was introduced by
(A)Mohan kanda
(B) Narasimhan
(D) Nichosan
(C) Raiffiesen
PARAS AHIR
1
Ag. Econ 3.2
(10)
(11)
(12)
(13)
(14)
(15)
(16)
(17)
(18)
Loans granted by the Government during British rule are called ________
loans
(A) Chattal
(B) Taccavi
(C) Term
(D) Self liquidating
Under single window system, production credit disbursement is through
____ tier structure
(A) One
(B)Two
(C) Three
(D) Four
Which of the following is a refinancing agency?
(A) MARKFED
(B) DCMS
(C) DISCOBARD
(D) AFC
In the first spell of nationalization, number of banks nationalized are
(A) 4
(B) 14
(C)6
(D) 16
The RBI committee under the Chairmanship of B.K. Hazare
recommended for the establishment of
(A) Crop loan system
(B) NABARD
(C) CCIS
(D) DIR scheme
Agriculture Finance Corporation was promoted by
(A) NABARD
(B) RBI
(C) Indian Banks Association
(D) State Government
To calculate the economic feasibility of loan proposal, the loans are
categorized as
(A) ST and MT loans
(B) SLL and PLL loans
(C) Direct and Indirect loans
(D) All the above
Which of the following is not the criterion for sanctioning loans by
financial installation?
(A) Gender
(B) Size of holding
(C) managerial capacity
(D) Caste
Which of the following sequence is correct regarding jurisdiction of
banks?
(A) PACS>RRB>LAMPS
(B) LAMPS>RRB>PACS
(D) None
(C)RRB>LAMPS>PACS
PARAS AHIR
2
Ag. Econ 3.2
(19)
(20)
(21)
(22)
(23)
(24)
(25)
(26)
A small farmer has taken a loan amount of Rs. 10000/- from a bank for
cultivating bajra during kharif season, 2007. The following premium
amount (Rs/-) he pays to the banks:
(A) 125
(B) 175
(C) 250
(D) 350
The financial progress being made in a farm business from one year to
the net year in best shown by a change in
(A) Total assets
(B) Cash available
(C) Liabilities
(D) Net worth
Which of the following serves as refinancing agency ?
(A) MARKFED
(B) RRB
(C) RBI
(D) APCPBARD
Risk in farm business increase when
(B) Proportion of equality funds
(A) farmer insures the crops
increase
(C) Proportion of non-equality funds
(D) None
decrease
Rate of interest charged under DIR scheme is
(A) 1%
(B) 4%
(C)2%
(D) 6%
Which of the following helps in checking the duplication of financing ?
(A) DIR approach
(B) SAA
(C) Nationalization of commercial
(D) SWS
banks
Crop insurance given to farmers represents
(A) ST loans
(B) MT loans
(C) DIR loans
(D) Compensation
LDBs fall under the category of
(A) Cooperative banks
(B) Commercial Banks
(D) All
(C) NBFI
PARAS AHIR
3
Ag. Econ 3.2
(27)
(28)
(29)
(30)
(31)
(32)
(33)
(34)
(35)
A farmer has retired and is planning to rent his 50 acre to the neighbor
for cash rent. Which factor should he consider when arriving at a fair
cash rent figure per acre.
(A) interest on investment taxes
(B)interest on investment per acre
and profits
(D) Neighbors cost of production per
(C) Price of crops raised
acre
The repayment period for ST/crop loans/SAO loans is ______ months.
(A) 12
(B) 6-18
(C) 24
(D)12-24
Terms loans/Investment loans constitute _______ loans
(A) ST loans
(B) ST and MT
(C) MT and LT
(D)ST and LT
Consumptions loans given to the beneficiaries are __________
(A) Unproductive
(B) Directly Productive
(C) Indirectly Productive
(D)None
Marketing loans are given to the farmers to the extent_______% of value
of produce
(A) 25
(B) 50
(C) 75
(D) 100
A budget predicts
(A) Price Fluctuation
(B) Net Worth change
(C) Income and Expenses
(D) Inventory change
A farm assets is
(A) What a farmer owns
(B) What a farmer owes
(C) What a farmers cultivated last
(D) An account payable
years
Which of the following is offered as personal security for claiming the
loan by the farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(C) Land
(D) Promissory Note
Which of the following is offered as mortgage for claiming the loan by
the farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(D) LIC bonds
(C) Land
PARAS AHIR
4
Ag. Econ 3.2
(36)
(37)
(38)
(39)
(40)
(41)
(42)
(43)
(44)
(45)
Which of the following is offered as collateral for claiming the loan by the
farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(C) Land
(D) LIC bonds
An example for hypothecated open loans
(A) Gold
(B) Tractor
(D) LIC bonds
(C) Land
An example for hypothecated key loans
(A) Agriculture produce
(B) Tractor
(C) Land
(D) LIC bonds
An example for security under chattal loans
(A) Agriculture produce
(B) Tractor
(C) Gold Ornaments
(D) LIC bonds
At the end of the year, a farmer owns Rs. 5000 to the local pesticide
dealer. It would be shown on the farm’s balance sheet as
(A) A prepaid expense
(B) Account receivable
(C) Account payable
(D)An asset
Assets are
(B) what the farmer business owns to
(A) Always equal liabilities
creditors
(C)Item that have value
(D) the same as owner’s equity
First spell of nationalization of commercial banks took place on
(A) 19th July, 1969
(B) 19th July, 1980
(C) 15th April, 1969
(D) 15th April, 1980
Second spell of nationalization of commercial bank took place
(A) 19th July, 1969
(B) 19th July, 1980
(C) 15th April, 1969
(D) 15th April, 1980
During first spell of nationalization of commercial banks, 14 banks were
nationalized having deposits
(A) >200 crores
(B) >100 crores
(C) >50 crores
(D) <25 crores
nd
During 2 spell of nationalization of commercial banks, 6 banks were
nationalized having deposits
(A) >200 crores
(B) >100 crores
(C) >50 crores
(D) <25 crores
PARAS AHIR
5
Ag. Econ 3.2
(46)
(47)
(48)
(49)
(50)
(51)
(52)
Debt is:
(A)Items that have no market
(B) The obligation to pay
value
(C) Owner’s equity
(D) Account receivable.
In a cash flow projection analysis of farm, what would you do if a certain
month indicated that there would be more expense than income?
(A) Terminate the enterprise
(B) Change from cash to accrual
causing the cash flow problem
accounting method
that month
(C) Use savings, delay expenses,
(D) change depreciation methods
move up sales or borrow money.
In preparing a cash flow plan, one should not include which of the
following expense items:
(B) cash paid for machinery
(A) Machinery depreciation
purchases
(C) Principal payments on long
(D) family living and other non-farm
term debt
expense
One of the best measures of financial progress over a period of years
would be:
(A) Income tax paid statement
(B) Capital investment
(C) Net worth statement
(D) Net cost income
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing marketing credit?
(A) DCMS
(B) APCOBARD
(C)SCB
(D) MARKFED
Which of the following cooperative credits institutes functioning at apex
level in Andhra Pradesh for disbursing marketing credit?
(A) DCMS
(B) APCOBARD
(C)SCB
(D) MARKFED
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing production credit?
(A) DISCOBARD
(B) APCOBARD
(D) MARKFED
(C)PACS
PARAS AHIR
6
Ag. Econ 3.2
(53)
(54)
(55)
(56)
(57)
(58)
(59)
(60)
(61)
Which of the following cooperative credit institute functioning at grass
root level in Andhra Pradesh for disbursing marketing credit?
(A) DISCOBARD
(B) APCOBARD
(C)SCB
(D) PACS
With reference to cooperative credit structure in India, the production
credit for ST&MT loans are disbursed through _____________ tier
(A) Three
(B) Two
(C) Four
(D) Unitary
With reference to cooperative credit structure in India, the production
credit for LT loans are disbursed through _____________ tier
(A) Three
(B) Two
(C) Four
(D) Unitary
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing LT, ST & MT loans?
(A) DCMS
(B) APCOBARD
(C) SCB
(D) MARKFED
Which of the following cooperative credit institute functioning at apex
level in India for disbursing LT loans ?
(A) PLDB
(B) APCOBARD
(C) PACS
(D) CLDB
Which of the following cooperative credit institute functioning at grass
root level in India for disbursing LT loans ?
(A) PLDB
(B) APCOBARD
(C) PACS
(D) CLDB
Which of the following cooperative credit institute functioning at grass
root level in Andhra Pradesh for disbursing ST, MT & LT loans ?
(A) MARKFED
(B) AFCOBARD
(C) SCB
(D) PACS
The cooperative credit society in India were organized based on
________ model
(A) Single Window
(B) Raiffeissen
(C) Mehta
(D) Acharya
Which of the following cooperative societies directly provides credit to
the farmer–borrower?
(A) SCB
(B) APCOBARD
(C)PACS
(D)All
PARAS AHIR
7
Ag. Econ 3.2
(62)
(63)
Which of the following cooperative societies supervises the end use of
credit ?
(A) SCB
(B) APCOBARD
(C)PACS
(D) All
In India, first LMB was established in __________ state.
(A) Gujarat
(C) Punjab
(64)
The purpose of tax planning and management is
(A) To minimize the tax bill
(C) Reduce the chance of audit
(65)
(66)
(67)
(68)
(69)
(B) Andhra Pradesh
(D) Orissa
(B) Maximize profits after taxes
(D) Improve record keeping
In Andhra Pradesh, first LMB was established in __________ district.
(A) Kurnool
(B) East Godavari
(C) West Godavari
(D) Krishna
The banking institutes which combines the features of both commercial
and cooperative banks is
(A) FFS
(B) RRB
(C) LAMPS
(D) NARABD
Livestock, Fixed deposit bonds, LIC bonds and other personal property
used to secure the loan are known as,
(A) Mortgage
(B) Amortization
(C) Collateral
(D) Chattal
Net worth is a measure of
(A) Managerial ability
(B) Liquidity
(C) Profitability
(D) Financial position
Increasing leverage during a period when a farm’s percent return to total
capital is less than the interest rate will mean
(A) Higher returns to equity
(B) Lower returns to equity
(D) Lower gross income
(C) Lower risk
PARAS AHIR
8
Ag. Econ 3.2
(70)
Which of the following is the primary purpose of a current ratio?
(A) To determine net worth
(71)
(72)
(73)
(74)
(75)
(C) to determine farm’s ability to
(D) To aid in evaluating your farm
meet immediate financial
profitability
obligations
A ratio that is interested differently than the others in that a small value
indicates a stronger financial positions:
(A) Debt/equity
(B) Net capital
(C) Current
(D) Working Capital
One of the main disadvantages of a father son partnership is that :
(A) Father and son might have
(B) The son may not have enough
different goals and objectives
capital to invest
(C)The farm may not be large
(D) Farm prices are too low
enough
The difference between the book value or basis of an asset and the sale
price of the asset is called ___________.
(A) Profit or loss
(B) Positive or negative cash flow
(C)capital gain or loss
(D) Marking money on the sale
The ability of a farm business to pay all of its debts, if it were to be
liquidated at given point is
(A)Solvency
(B) Turnover
(C)Margin
(D)Risk
The major sub-divisions of balance sheet are
(A) Cash receive, cash paid, cash
remaining
(C) Assets, Liabilities and net
worth
(76)
(B) to determine farm’s ability to
meet long-term financial obligations
(B) Income, expenses, Net profit
(D) Amount borrowed, amount paidoff and balance outstanding
A team which has the same meaning as owner’s equity is
(A) Net worth
(B) Net farm income
(D) Total liability
(C) total asset value
PARAS AHIR
9
Ag. Econ 3.2
(77)
(78)
(79)
(80)
(81)
(82)
(83)
A projection of income and expenses associated with growing acre of a
particular crop would be called ___________
(A) A particular budget
(B) Balance budget
(C)A whole farm budget
(D)An enterprise budget
Which of the following would most likely warrant an increase in
production by a firm ?
(A) The firm is making money
(B) The firm’s cash flow is positive
(C) The firm’s marginal revenue
(D) The firm has low fixed costs
exceeds the firm’s marginal cost
A measure of profitability of your farm business is
(A)percent return on equity
(B) Leverage ratio
(ROE)
(C) Debt to total asset ratio
(D) Current ratio
Which one of the following would tend to reduce risk for the manager of
a farm business ?
(A) Selecting the crop with the
(B) Diversification
highest net return
(C) Selling all commodities
(D) Specializing in a single enterprise
Which of the following refers to a farmer’s ability to pay its bills in the
short run ?
(A) Solvency
(B) Liquidity
(C) Net worth
(D) Debt
An enterprise budget is
(A) A plan for using the firm’s
resources during some future
period
(B) Impossible to modify to fit an
individual’s needs
(C) The basic tool used in
analyzing a change in farm
operations, and estimating the
change in net income
(D) A plan for producing an
agriculture commodity that shows
the costs, resources used, and
anticipated return per production
unit.
Which of the following is not a component of Balance-sheet ?
(A)Cash inflow
(C) Long term liabilities
(B) Assets
(D) Net worth
PARAS AHIR
10
Ag. Econ 3.2
(84)
(85)
(86)
Which of the following is not one among 5Cs of credit ?
(A) Capacity
(B) Character
(C) Commonsense
(D) Credit worthiness
Why gross returns are deflated, while computing Risk Bearing Ability of
the farmer-borrower?
(B) farmer returns are more
(A) Farmers are not credit worthy
fluctuating
(C) Farmers are generally willful
(D) Difficult to compute gross returns
defaulter
from the enterprise budgeting
Repayment capacity of the farmer-borrower mainly depends upon
(A) Family size
(C) Income
(87)
Which of the following ratio cannot be computed from Balanced-sheet?
(A) Quick ratio
(C) Current ratio
(88)
(B) Assets
(D) (a) and (b)
Which of the following type of loan fall under hypothecated loan
(A) Autorickshaw loan
(C) LIC bonds
(91)
(B) Net capital ratio = 1 is desirable
(D) Acid test ratio = 1 is desirable
Which of the following is not a component of income statement
(A) Expenses
(C) Returns
(90)
(B) Capital turnover ratio
(D) (a) and (c)
Which of the following statement is True ?
(A) Current ratio = 1 is desirable
(C)Working ratio = 1 is desirable
(89)
(B) Character
(D) Commonsense
(B) Promissory note
(D) Chattal loan
Which of the following is not an higher financing agency ?
(A)IBRD
(B) RBI
(D) NABARD
(C) RRB
PARAS AHIR
11
Ag. Econ 3.2
(92)
(93)
(94)
When there is break even in the business, it is advisable for the financial
institution
(B) To recommend the farmer to
(A) To consider that farmer is not
depend solely on private money
credit worthy
lenders
(C) To recommend the farmer to
(D) To lend ST loan to the farmer
stop the business temporarily
Which of the following is not a programme executed for rural
development
(A) SFDA
(B) AREIF
(C) IRDP
(D) MFAL
The concept of SHGs came into existence due to the fact that
(A) Small and marginal need
financial assistance for
consumption purposes
(C) The Cost of credit is low for
small and marginal farmers for
availing ST and MT loans
(95)
(B) ICF
(D) IFC
Which of the following is not regulated by RBI ?
(A) CRR
(C) IRR
(98)
(B) Open loan
(D)Indirect loan
Which of the following is not a constitution of World bank ?
(A) IDA
(C) IMF
(97)
(D) All the above
The loan and advanced by a bank to drip irrigation firm is called as
(A) Pledge loan
(C) Chattal Loan
(96)
(B) Majority of small and marginal
farmers are not credit worthy
(B) Bank rate
(D) Reverse rapo rate
LAMPS came into existence in the year __________
(A)1971
(B) 1975
(D) 1972
(C)1980
PARAS AHIR
12
Ag. Econ 3.2
(99)
LAMPS came into existence to meet the credit needs of ____________
(A) Weaker section
(C) Medium farmer
(100)
(B) Large farmer
(D) Tribal farmer
The jurisdiction of LAMPS is _______
(A) 1 district
(B) 1 Village
(C) 1 taluka
(D)none
(101) LAMPS came to into existence based on the recommendation of ______
team
(A) B. Siva Raman
(B) Bawa
(C) NCA
(D) M. Narasimham
(102)
Which of the following is not a component of cost of credit ?
(A) Loan amount
(B)Interest
(C) Loss of opportunity wage
(D) All
earing
(103) Among the following the Impact of cost of credit is more on _______
farmer
(A) Small
(B) Medium
(C) Large
(D) None
(104) To check the higher impact of cost of all credit on the part of small
farmers, _______ scheme came into existance
(A) KCC
(B) DIR
(C) SLGS
(D) All
(105) DIR scheme was proposed to check one of the following on the part of
small farmers
(A) Transportation charges from
(B) Loss of opportunity wage earning
village to bank
(D) Unauthorized payments by
(C)Cost of credit
farmers
(106)
DIR scheme was proposed by ________ committee
(A) B. K. Hazare
(C)Mohan Khanda
(B) B. Siva Raman
(D) V. L. Mehta
PARAS AHIR
13
Ag. Econ 3.2
(107)
A line-of-credit loan to purchase fertilizer is
(A) A mortgage
(C) A consumer loan
(108)
At low interest rates,
(A) The demand for credit is low
(C) The quantity of credit
demanded is high
(109)
(B) Decrease in Non- equity capital
(D) Improvement in soil fertility
Which of the following is quoted as ‘Double-edged knife’?
(A) Credit
(C) Cost of credit
(112)
(B) Cost of credit
(D)Leverage
Risk in farm business increase with
(A) Increase n Equity Capital
(C) Leverage
(111)
(B) The demand for credit is high
(D) The quantity of credit demanded
is low
The ratio between non-equity capital to equity capital is called
(A) Equity
(C) Liquidity
(110)
(B) An operating loan
(D) A long term loan
(B) Interest
(D) All
Series of periodic loan payments is an example of a/an
(A) Fixed future value
(B) Net Present value
(C) Annuity
(D) None
(113) A loan which is repaid from the assets originally purchase with the loan is
a
(A)Lease
(B) Self-liquidity loan
(C) Discount value
(D) Balloon loan
(114)
A producer most often uses a cash flow statement to ________
(A) Estimate the amount of
credit needed and when it is
needed
(C)Estimate potential cash
overflow
(B) Determine equipment needs
(D) Estimate when debt payments
will come due
PARAS AHIR
14
Ag. Econ 3.2
(115) The incremental income due to loan investment can be worked out by
using
(A)Cobb-douglas production
(B) partial budgeting technique
function
(C)Linear programming
(D) Compound growth rate
techniques
(116) Which of the following is inversely related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Size of holding
(C) Family expenses
(D) All
(117) Which of the following is inversely related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Size of holding
(C)Farm working expenses
(D) All
(118) Which of the following is directly related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Farm working expenses
(C) Family expenses
(D) All
(119) The following is/are the important reasons for poor repayment capacity
of the farmer-borrower in India.
(A) Small size holding
(B) Higher family expenditure
(C) Higher farm working expenses (D) All
(120) Which of the following improves the repayment capacity of the farmerborrower ?
(A) Improving net worth of farm
(B) Crop diversification
business
(C )Adopting modern technology
(D) All
in the farm
(121) The adjustment of gross income of farm-business to its coefficient of
variation in the project area is called
(A) Risk bearing ability
(B) Deflation
(C) Inflation
(D) Stagflation
(122)
Indian banks have the maximum foreign branches in
(A) Bangladesh
(C) U. K.
(B) U.S.A.
(D) Sri Lanka
PARAS AHIR
15
Ag. Econ 3.2
(123) While estimating the ________ of the farmer-borrower, gross return is
deflated
(A) Repayment capacity
(B) Risk bearing ability
(C) Returns
(D) Rate of return
(124) If the repayment capacity of the farmer-borrower is higher even under
risk conditions, its indicate ______ on the part of farmer-borrower.
(A) Higher Risk bearing ability
(B) High cost of credit
(C) Inadequate loan taken
(D) All of above
(125) Which of the following improves the risk bearing ability of the farmerborrower?
(A) Improving net worth of farm
(B) Encouraging saving
business
(C) Insuring enterprises
(D) All of above
(126) A cash flow budget projected for the next year can provide information
on
(A) Net worth of the farm
(B) Return to the farm operator’s
business
labor and management
(C) Projected borrowing
(D) Rate of return on the farm
requirements and repayment
investment
ability
(127)
A business is “Solvent” is
(A) Total receipts exceed total
(B) Total debt exceeds total equity
expenditures
(C) Total sales exceed total cash
(D) Total assets exceed total
expenses
liabilities
(128) Statement of projected costs and returned associated with one
production process, usually for one production period called
(A) Partial budget
(B) Enterprises budget
(C) Total farm budget
(D) Cash flow projection
(129) A physical and financial plan for the entire farm business for a specific
period of time is called
(A) Total farm budget
(B) Cash flow projection
(D) Partial budget
(C) Enterprise budget
PARAS AHIR
16
Ag. Econ 3.2
(130)
Repayment capacity best measured by the
(A) Enterprise budget
(C) Profit and loss statement
(131)
In increasing net worth can result from
(A)Increasing debt
(C) Increasing farm inventory
values
(132)
(B) projection cash flow statement
(D) Check book
(B) Decreasing farm inventory values
(D) Decreasing farm inventory values
Crop insurance provides a means of
(A) Reducing risks
(B) Lowering costs
(C) Increasing profits
(D) Increasing working capital
(133) Financial, Opportunity, cash, and economic are terms used to describe
different type of the following for a farm firm
(A) Revenues
(B) Costs
(C)Liabilities
(D) Assets
(134)
________ is the rate at which banks borrow from the RBI
(A) Bank rate
(C) Repo rate
(135)
(B) Reverse repo rate
(D) CRR
Capacity is the second ‘C’ of credit, which indicates
(A) Capacity to withstand risk
(B) Capacity to repay plan
(C) Capacity to avail marketing
(D) capacity to avail production loan
loans
(136) Which of the following ‘C’s of credit is considered as prima-facie for
sanctioning the loan by the banker to the farmer-borrower?
(A) Character
(B) Capacity
(C) Condition
(D) Commonsense
(137)
Which of the following is the first ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(B) Principal of protection
(D) Principal of productivity
PARAS AHIR
17
Ag. Econ 3.2
(138)
Which of the following is the 2nd ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(139)
(B) Principal of productivity
(D) Principal of protection
Which of the following is the fourth ‘P’ of credit ?
(A) Principal of payment
(C) Principal of phased
disbursement
(141)
(D) Principal of personality
Which of the following is the third ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(140)
(B) Principal of protection
(B) Principal of productivity
(D) Principal of protection
Which of the following is the fifth ‘P’ of credit ?
(A) principal of proper utilization (B) Principal of protection
(C) Principle of productive
(D) Principal of productivity
purpose
(142)
Which of the following is the sixth ‘P’ of credit ?
(A) Principal of payment
(C) Principle of productive
purpose
(143)
(D) Principal of productivity
Which of the following is the seventh ‘P’ of credit ?
(A) Principal of payment
(C) Principle of productive
purpose
(144)
(B) Principal of protection
(B) Principal of protection
(D) Principal of productivity
Principle of personality is the 2nd ‘P’ of credit, which indicates
(A) principal of proper utilization
(B) Trust worthiness borrower
(D) Risk bearing ability of farmers
(C) Productive use of loan
PARAS AHIR
18
Ag. Econ 3.2
(145) Principle of personality is the 2nd ‘P’ of credit, which directly influences
the
(A) Risk bearing ability of farmer (B) Functional efficiency of bank
(C) Productive loan utilization
(D) Insurance coverage of farmers
(146)
Principle of personality is the 6th ‘P’ of credit, which directly influence the
(A) Prompt disbursement of loan (B) Unauthorized payment of
by banks
borrower
(C) Prompt repayment of loan by
(D) All of above
borrower
(147) Under adverse climate conditions, ________ scheme repays loans to the
banks on the part of weaker sections
(A)Kisan credit card
(B)DIR scheme
(C)SLGS
(D) Crop insurance scheme
(148) Which of the following is the correct formula to complete incremental
income from the loan investment by using partial budgeting technique ?
(A) (AR+RC)-(AC+RR)
(B) (AC+RR)-(AR+RC)
(C) (AR+RR)-(AC+RC)
(D) None
(149) The concept of repayment plans will generally arise in case of _______
loans
(A) ST loans
(B) LT loans
(C) SAO loans
(D) Self liquidating loans
(150)
The concept of repayment plans will not arise in case of _______ loans
(A) MT loans
(B) LT loans
(C) ST loans
(D) Partial liquidating loans
(151) Which of the following repayment plan is also called as balloon
repayment plan
(A)Amortized decreasing
(B) Variable repayment plan
repayment plan
(D) Partial repayment plan
(C) Amortized even repayment
plan
PARAS AHIR
19
Ag. Econ 3.2
(152) In _______ repayment plan, principal amount is paid in lumpsum in the
last year and interest is paid regularly
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Variable repayment plan
plan
(153) In _______ repayment plan, the installment amount gradually decreases
over a period, but in the last, huge installment is paid
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(154) Which of the following is also called as Single/Lumpsum repayment plan
?
(A) Amortized decreasing
(B) Amortized even repayment plan
repayment plan
(C) Straight-end repayment plan (D) Partial repayment plan
(155) In _______ repayment plan, the installment amount gradually decrease,
but principal amount remains same throughout the repayment period in
the last, huge installment is paid
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(156) In ______ repayment plan, the installment amount remains same
through out the repayment period
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(157) Which of the following is correct with the reference to amortized
decreasing repayment plan?
(A) Installment increases,
(B) Installment decreases, Principal
Principal and
interest
and
interest increases
decreases
(C) Installment and Principal
(D) Installment and intrest decrease,
decrease, Interest remains same Principal remains same
PARAS AHIR
20
Ag. Econ 3.2
(158) Which of the following is correct with the reference to amortized even
repayment plan?
(A) Installment increases,
(B) Installment decreases, Principal
Principal and
interest
and
interest increases
decreases
(C) Installment remains same ,
(D) Installment remains same ,
Principal increase, Interest
Principal decrease, Interest increase
decrease
(159) In amortized even repayment plan of credit, the repayment of
installments are
(A) Large proportion of each
(B)small proportion of each
succeeding principal amount and succeeding principal amount and a
a smaller amount of interest
larger amount of interest
(C) Equal proportion of principle
(D) Not a set sequence
and interest
(160) In amortized decreasing repayment plan of credit, the repayment of
installments are
(A) Large proportion of each
(B)small proportion of each
succeeding principal amount and succeeding principal amount and a
a smaller amount of interest
larger amount of interest
(C) Constant principal amount
(D) Not a set sequence
and declining interest
(161) For which of the following, amortized decreasing repayment plan is
followed?
(A) Paddy loan
(B) Tractor loan
(C) Loan given for diggimg wells
(D) Machinery loan
(162)
For which of the following, amortized even repayment plan is followed ?
(A) Paddy loan
(B) Tractor loan
(C) Loan given for diggimg wells (D) Machinery loan
(163) In _______ repayment plan, the size of installment paid depends upon
the level of income from the agri-business
(A) Amortized decreasing
(B) straight-end repayment plan
repayment plan
(D) variable repayment plan
(C) Amortized even repayment
plan
PARAS AHIR
21
Ag. Econ 3.2
(164)
Reverse repayment plan is also called _________
(A) Amortized decreasing
(B) Future repayment plan
repayment plan
(C) Amortized even repayment
(D) partial repayment plan
plan
(165) In _______ repayment plan, facility is given to the farmer-borrower to
pay advanced installments at times of good harvest and no payment at
times of poor harvest
(A) Amortized decreasing
(B) Amortized even repayment plan
repayment plan
(C) Reserve repayment plan
(D) variable repayment plan
(166) The payment plan generally followed by the banking institution in areas
where agri-business income shows higher degree of variability
(A) Reserve repayment plan
(B) Amortized even repayment plan
(C) Amortized decreasing
(D) variable repayment plan
repayment plan
(167)
Repayment of loans in a series of installments is called ________
(A) Liquidity
(C) Leverage
(168)
Net worth statement is also called as ________
(A) Income statement
(C) cash flow statement
(169)
(B) profit and loss statement
(D) Balance sheet
In net worth statement, assets are on _________ side
(A) Left
(C) Middle
(170)
(B) Amortization
(D) Hypothecation
(B) Right
(D) Not included
In net worth statement, liabilities are on ________ side
(A) Left
(B) Right
(D) Not included
(C) Middle
PARAS AHIR
22
Ag. Econ 3.2
(171) If assets are more than liabilities in Net worth statement, net worth is on
________ side
(A) Left
(B) Right
(C) Middle
(D) Not included
(172) If assets are less than liabilities in Net worth statement, net deficit is on
________ side
(A) Left
(B) Right
(C) Middle
(D) Not included
(173) ______ is the return banks earn on excess funds parked with the central
bank against Government securities
(A) Bank rate
(B) Reverse repo rate
(C) Repo rate
(D) CRR
(174) ________ is a debt security issued by a company (called issuer), which
offers to pay interest in lieu of the money borrowed for a certain period
(A) T-Bill
(B) Debunture
(C) G-Secs
(D) None
(175)
If net worth is positive for business, it indicates the business is said to be
(176)
(177)
(178)
(179)
(A) Leverage
(B) Amortized
(C) Solvent
(D) Insolvent
The financial ratio which indicates the liquidity position of the farm
business in the shortest or immediate period is called ________
(A) Intermediate ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
The financial ratio which indicates the liquidity position of the farm
business in the immediate period is called ________
(A) Acid test ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
The financial ratio which indicates the liquidity position of the farm
business in the long run period is called ________
(A) Acid test ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
Acid test ratio is otherwise called as __________
(A) Quick ratio
(B) Working ratio
(D) Current ratio
(C) Net capital ratio
PARAS AHIR
23
Ag. Econ 3.2
(180) An Acid Test ratio of 1 is ___________ for the business
(A) Desirable
(B) Not desirable
(C) Break even point
(D) Not meaning
(181) Income statement is otherwise called as ___________
(A) Net worth statement
(B) Cash flow statement
(C) Balance sheet
(D) Profit/Loss statement
(182) Income statement summarizes the __________ and __________ of the
farm business
(A) Assets and liabilities
(B) Flow of funds statements
(C) Income and Expenditure
(D) Equity and Non equity capital
(183) Cash flow statement is otherwise called as _________
(A) Net worth statement
(B) Flow of funds statement
(C) Balance sheet
(D) Profit/Loss statement
(184) _________ is prepared to overcome the deficiencies in NWS and income
statement
(A) Net worth statement
(B) Profit/Loss statement
(C) Balance sheet
(D) Flow of funds statement
(185) _________ is the financial statement prepared for the future
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(186) Net income, net operating income and net farm income can be
calculated from ________ statement
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(187) _________ financial statement enables the farmer to plan the
ernterprises and procurement of resources in advances
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(188) Which of the following statements about growth of credit and deposits
of banks in 2010-11 is/are correct ?
I.
Credit growth
II.
Deposit growth was 32.11 per cent
III.
Credit growth was higher than at 15.84 per cent
(A) I only
(B) II and III only
(D) I and II only
(C) II only
PARAS AHIR
24
Ag. Econ 3.2
(189) The asian development Bank(ADB) has scaled down its projection for
india’s economic growth in 2011-12 to _______ recently.
(A) 6.3 per cent
(B) 6.8 per cent
(C) 8.2 per cent
(D) 7.6 per cent
(190) Which state has the highest number of operational special economic
Zones (SEZs) as per recent information from the ministry of commerce
and industry?
(A) Kerala
(B) Tamil Nadu
(C) Karnataka
(D) Andhra Pradesh
(191) When a farmer prepared a list of expected income and expenses for
next year, he has developed
(B) A financial statement and a
(A) Income tax report
projected cash flow
(C) An inventory
(D) A projected cash flow
(192) CADA came into existence in _________ five year plan
(A) III
(B) V
(C) VII
(D)IV
(193) Liquidity is Best described as
(A) Total assets minus total
(B) The ability to meet cash
liabilities
obligations as they come due
(C) Having no long term debt
(D) The rate of capital turn-over
(194) IRDP is basically a/an
(A) varietal improvement
(B) Crop insurance programme
programme
(C) Drought relief programme
(D) Anti-poverty programme
(195) Under SFDA and MFAL, the percent subsidy to small farmer is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(196) Under SFDA and MFAL, the percent subsidy to marginal farmer and
agricultural laborers is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(197) Under IRDP, the percent subsidy to small farmer is _______ %
(A) 10
(B) 25s
(D) 33.3
(C) 50
PARAS AHIR
25
Ag. Econ 3.2
(198) Under IRDP, the percent subsidy to marginal farmer is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(199) Repayment capacity best measured by the
(A)Enterprise budget
(B) Profit and loss statement
(C)Projected cash flow statement (D) Check book
(200) Which of the following is permanent programme ?
(A) IRDP
(B) CADA
(C) SFDA and MFAL
(D) DPAP
PARAS AHIR
26
Ag Econ 3.2
Question Bank
AGRICULTURAL FINANCE AND COOEPRATION
(AG. ECON 3.2)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
Under single window system, cooperative marketing is under ______ tier
structure
(A) One
(B) Two
(C) Three
(D) Four
Loans obtained from pawn broken by pledging movable property are
called _________loans
(A)Term
(B) Production
(C) Chattal
(D)All
The number of banks nationalized so far are
(A) 9
(B) 14
(C) 30
(D) 20
NABARD took over the function of
(A) ACD
(B) ARDC
(C) RPCC
(D)All
FSS on cooperative lines are recommended by
(A) Bawa team
(B) NCA
(C) Royal commission on
(D) Gadgil committee
agriculture
RRBs share capital is being subscribed by the central government, State
government and sponsoring bank in the ratio of
(A) 50:15:35
(B) 50:35:15
(C) 50:25:25
(D)50:40:10
Loans advanced to the agro-input manufacturing industries are called
(A) Open
(B) Key
(C) Direct
(D)Indirect
Key and Open loans are together called as _________ loans
(A) Mortgage
(B) Pledge
(C) Production
(D)Term
Single window system in cooperative credit structure was introduced by
(A)Mohan kanda
(B) Narasimhan
(D) Nichosan
(C) Raiffiesen
PARAS AHIR
1
Ag. Econ 3.2
(10)
(11)
(12)
(13)
(14)
(15)
(16)
(17)
(18)
Loans granted by the Government during British rule are called ________
loans
(A) Chattal
(B) Taccavi
(C) Term
(D) Self liquidating
Under single window system, production credit disbursement is through
____ tier structure
(A) One
(B)Two
(C) Three
(D) Four
Which of the following is a refinancing agency?
(A) MARKFED
(B) DCMS
(C) DISCOBARD
(D) AFC
In the first spell of nationalization, number of banks nationalized are
(A) 4
(B) 14
(C)6
(D) 16
The RBI committee under the Chairmanship of B.K. Hazare
recommended for the establishment of
(A) Crop loan system
(B) NABARD
(C) CCIS
(D) DIR scheme
Agriculture Finance Corporation was promoted by
(A) NABARD
(B) RBI
(C) Indian Banks Association
(D) State Government
To calculate the economic feasibility of loan proposal, the loans are
categorized as
(A) ST and MT loans
(B) SLL and PLL loans
(C) Direct and Indirect loans
(D) All the above
Which of the following is not the criterion for sanctioning loans by
financial installation?
(A) Gender
(B) Size of holding
(C) managerial capacity
(D) Caste
Which of the following sequence is correct regarding jurisdiction of
banks?
(A) PACS>RRB>LAMPS
(B) LAMPS>RRB>PACS
(D) None
(C)RRB>LAMPS>PACS
PARAS AHIR
2
Ag. Econ 3.2
(19)
(20)
(21)
(22)
(23)
(24)
(25)
(26)
A small farmer has taken a loan amount of Rs. 10000/- from a bank for
cultivating bajra during kharif season, 2007. The following premium
amount (Rs/-) he pays to the banks:
(A) 125
(B) 175
(C) 250
(D) 350
The financial progress being made in a farm business from one year to
the net year in best shown by a change in
(A) Total assets
(B) Cash available
(C) Liabilities
(D) Net worth
Which of the following serves as refinancing agency ?
(A) MARKFED
(B) RRB
(C) RBI
(D) APCPBARD
Risk in farm business increase when
(B) Proportion of equality funds
(A) farmer insures the crops
increase
(C) Proportion of non-equality funds
(D) None
decrease
Rate of interest charged under DIR scheme is
(A) 1%
(B) 4%
(C)2%
(D) 6%
Which of the following helps in checking the duplication of financing ?
(A) DIR approach
(B) SAA
(C) Nationalization of commercial
(D) SWS
banks
Crop insurance given to farmers represents
(A) ST loans
(B) MT loans
(C) DIR loans
(D) Compensation
LDBs fall under the category of
(A) Cooperative banks
(B) Commercial Banks
(D) All
(C) NBFI
PARAS AHIR
3
Ag. Econ 3.2
(27)
(28)
(29)
(30)
(31)
(32)
(33)
(34)
(35)
A farmer has retired and is planning to rent his 50 acre to the neighbor
for cash rent. Which factor should he consider when arriving at a fair
cash rent figure per acre.
(A) interest on investment taxes
(B)interest on investment per acre
and profits
(D) Neighbors cost of production per
(C) Price of crops raised
acre
The repayment period for ST/crop loans/SAO loans is ______ months.
(A) 12
(B) 6-18
(C) 24
(D)12-24
Terms loans/Investment loans constitute _______ loans
(A) ST loans
(B) ST and MT
(C) MT and LT
(D)ST and LT
Consumptions loans given to the beneficiaries are __________
(A) Unproductive
(B) Directly Productive
(C) Indirectly Productive
(D)None
Marketing loans are given to the farmers to the extent_______% of value
of produce
(A) 25
(B) 50
(C) 75
(D) 100
A budget predicts
(A) Price Fluctuation
(B) Net Worth change
(C) Income and Expenses
(D) Inventory change
A farm assets is
(A) What a farmer owns
(B) What a farmer owes
(C) What a farmers cultivated last
(D) An account payable
years
Which of the following is offered as personal security for claiming the
loan by the farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(C) Land
(D) Promissory Note
Which of the following is offered as mortgage for claiming the loan by
the farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(D) LIC bonds
(C) Land
PARAS AHIR
4
Ag. Econ 3.2
(36)
(37)
(38)
(39)
(40)
(41)
(42)
(43)
(44)
(45)
Which of the following is offered as collateral for claiming the loan by the
farmer-borrower from the financial institution?
(A) Gold
(B) Tractor
(C) Land
(D) LIC bonds
An example for hypothecated open loans
(A) Gold
(B) Tractor
(D) LIC bonds
(C) Land
An example for hypothecated key loans
(A) Agriculture produce
(B) Tractor
(C) Land
(D) LIC bonds
An example for security under chattal loans
(A) Agriculture produce
(B) Tractor
(C) Gold Ornaments
(D) LIC bonds
At the end of the year, a farmer owns Rs. 5000 to the local pesticide
dealer. It would be shown on the farm’s balance sheet as
(A) A prepaid expense
(B) Account receivable
(C) Account payable
(D)An asset
Assets are
(B) what the farmer business owns to
(A) Always equal liabilities
creditors
(C)Item that have value
(D) the same as owner’s equity
First spell of nationalization of commercial banks took place on
(A) 19th July, 1969
(B) 19th July, 1980
(C) 15th April, 1969
(D) 15th April, 1980
Second spell of nationalization of commercial bank took place
(A) 19th July, 1969
(B) 19th July, 1980
(C) 15th April, 1969
(D) 15th April, 1980
During first spell of nationalization of commercial banks, 14 banks were
nationalized having deposits
(A) >200 crores
(B) >100 crores
(C) >50 crores
(D) <25 crores
nd
During 2 spell of nationalization of commercial banks, 6 banks were
nationalized having deposits
(A) >200 crores
(B) >100 crores
(C) >50 crores
(D) <25 crores
PARAS AHIR
5
Ag. Econ 3.2
(46)
(47)
(48)
(49)
(50)
(51)
(52)
Debt is:
(A)Items that have no market
(B) The obligation to pay
value
(C) Owner’s equity
(D) Account receivable.
In a cash flow projection analysis of farm, what would you do if a certain
month indicated that there would be more expense than income?
(A) Terminate the enterprise
(B) Change from cash to accrual
causing the cash flow problem
accounting method
that month
(C) Use savings, delay expenses,
(D) change depreciation methods
move up sales or borrow money.
In preparing a cash flow plan, one should not include which of the
following expense items:
(B) cash paid for machinery
(A) Machinery depreciation
purchases
(C) Principal payments on long
(D) family living and other non-farm
term debt
expense
One of the best measures of financial progress over a period of years
would be:
(A) Income tax paid statement
(B) Capital investment
(C) Net worth statement
(D) Net cost income
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing marketing credit?
(A) DCMS
(B) APCOBARD
(C)SCB
(D) MARKFED
Which of the following cooperative credits institutes functioning at apex
level in Andhra Pradesh for disbursing marketing credit?
(A) DCMS
(B) APCOBARD
(C)SCB
(D) MARKFED
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing production credit?
(A) DISCOBARD
(B) APCOBARD
(D) MARKFED
(C)PACS
PARAS AHIR
6
Ag. Econ 3.2
(53)
(54)
(55)
(56)
(57)
(58)
(59)
(60)
(61)
Which of the following cooperative credit institute functioning at grass
root level in Andhra Pradesh for disbursing marketing credit?
(A) DISCOBARD
(B) APCOBARD
(C)SCB
(D) PACS
With reference to cooperative credit structure in India, the production
credit for ST&MT loans are disbursed through _____________ tier
(A) Three
(B) Two
(C) Four
(D) Unitary
With reference to cooperative credit structure in India, the production
credit for LT loans are disbursed through _____________ tier
(A) Three
(B) Two
(C) Four
(D) Unitary
Which of the following cooperative credit institute functioning at apex
level in Andhra Pradesh for disbursing LT, ST & MT loans?
(A) DCMS
(B) APCOBARD
(C) SCB
(D) MARKFED
Which of the following cooperative credit institute functioning at apex
level in India for disbursing LT loans ?
(A) PLDB
(B) APCOBARD
(C) PACS
(D) CLDB
Which of the following cooperative credit institute functioning at grass
root level in India for disbursing LT loans ?
(A) PLDB
(B) APCOBARD
(C) PACS
(D) CLDB
Which of the following cooperative credit institute functioning at grass
root level in Andhra Pradesh for disbursing ST, MT & LT loans ?
(A) MARKFED
(B) AFCOBARD
(C) SCB
(D) PACS
The cooperative credit society in India were organized based on
________ model
(A) Single Window
(B) Raiffeissen
(C) Mehta
(D) Acharya
Which of the following cooperative societies directly provides credit to
the farmer–borrower?
(A) SCB
(B) APCOBARD
(C)PACS
(D)All
PARAS AHIR
7
Ag. Econ 3.2
(62)
(63)
Which of the following cooperative societies supervises the end use of
credit ?
(A) SCB
(B) APCOBARD
(C)PACS
(D) All
In India, first LMB was established in __________ state.
(A) Gujarat
(C) Punjab
(64)
The purpose of tax planning and management is
(A) To minimize the tax bill
(C) Reduce the chance of audit
(65)
(66)
(67)
(68)
(69)
(B) Andhra Pradesh
(D) Orissa
(B) Maximize profits after taxes
(D) Improve record keeping
In Andhra Pradesh, first LMB was established in __________ district.
(A) Kurnool
(B) East Godavari
(C) West Godavari
(D) Krishna
The banking institutes which combines the features of both commercial
and cooperative banks is
(A) FFS
(B) RRB
(C) LAMPS
(D) NARABD
Livestock, Fixed deposit bonds, LIC bonds and other personal property
used to secure the loan are known as,
(A) Mortgage
(B) Amortization
(C) Collateral
(D) Chattal
Net worth is a measure of
(A) Managerial ability
(B) Liquidity
(C) Profitability
(D) Financial position
Increasing leverage during a period when a farm’s percent return to total
capital is less than the interest rate will mean
(A) Higher returns to equity
(B) Lower returns to equity
(D) Lower gross income
(C) Lower risk
PARAS AHIR
8
Ag. Econ 3.2
(70)
Which of the following is the primary purpose of a current ratio?
(A) To determine net worth
(71)
(72)
(73)
(74)
(75)
(C) to determine farm’s ability to
(D) To aid in evaluating your farm
meet immediate financial
profitability
obligations
A ratio that is interested differently than the others in that a small value
indicates a stronger financial positions:
(A) Debt/equity
(B) Net capital
(C) Current
(D) Working Capital
One of the main disadvantages of a father son partnership is that :
(A) Father and son might have
(B) The son may not have enough
different goals and objectives
capital to invest
(C)The farm may not be large
(D) Farm prices are too low
enough
The difference between the book value or basis of an asset and the sale
price of the asset is called ___________.
(A) Profit or loss
(B) Positive or negative cash flow
(C)capital gain or loss
(D) Marking money on the sale
The ability of a farm business to pay all of its debts, if it were to be
liquidated at given point is
(A)Solvency
(B) Turnover
(C)Margin
(D)Risk
The major sub-divisions of balance sheet are
(A) Cash receive, cash paid, cash
remaining
(C) Assets, Liabilities and net
worth
(76)
(B) to determine farm’s ability to
meet long-term financial obligations
(B) Income, expenses, Net profit
(D) Amount borrowed, amount paidoff and balance outstanding
A team which has the same meaning as owner’s equity is
(A) Net worth
(B) Net farm income
(D) Total liability
(C) total asset value
PARAS AHIR
9
Ag. Econ 3.2
(77)
(78)
(79)
(80)
(81)
(82)
(83)
A projection of income and expenses associated with growing acre of a
particular crop would be called ___________
(A) A particular budget
(B) Balance budget
(C)A whole farm budget
(D)An enterprise budget
Which of the following would most likely warrant an increase in
production by a firm ?
(A) The firm is making money
(B) The firm’s cash flow is positive
(C) The firm’s marginal revenue
(D) The firm has low fixed costs
exceeds the firm’s marginal cost
A measure of profitability of your farm business is
(A)percent return on equity
(B) Leverage ratio
(ROE)
(C) Debt to total asset ratio
(D) Current ratio
Which one of the following would tend to reduce risk for the manager of
a farm business ?
(A) Selecting the crop with the
(B) Diversification
highest net return
(C) Selling all commodities
(D) Specializing in a single enterprise
Which of the following refers to a farmer’s ability to pay its bills in the
short run ?
(A) Solvency
(B) Liquidity
(C) Net worth
(D) Debt
An enterprise budget is
(A) A plan for using the firm’s
resources during some future
period
(B) Impossible to modify to fit an
individual’s needs
(C) The basic tool used in
analyzing a change in farm
operations, and estimating the
change in net income
(D) A plan for producing an
agriculture commodity that shows
the costs, resources used, and
anticipated return per production
unit.
Which of the following is not a component of Balance-sheet ?
(A)Cash inflow
(C) Long term liabilities
(B) Assets
(D) Net worth
PARAS AHIR
10
Ag. Econ 3.2
(84)
(85)
(86)
Which of the following is not one among 5Cs of credit ?
(A) Capacity
(B) Character
(C) Commonsense
(D) Credit worthiness
Why gross returns are deflated, while computing Risk Bearing Ability of
the farmer-borrower?
(B) farmer returns are more
(A) Farmers are not credit worthy
fluctuating
(C) Farmers are generally willful
(D) Difficult to compute gross returns
defaulter
from the enterprise budgeting
Repayment capacity of the farmer-borrower mainly depends upon
(A) Family size
(C) Income
(87)
Which of the following ratio cannot be computed from Balanced-sheet?
(A) Quick ratio
(C) Current ratio
(88)
(B) Assets
(D) (a) and (b)
Which of the following type of loan fall under hypothecated loan
(A) Autorickshaw loan
(C) LIC bonds
(91)
(B) Net capital ratio = 1 is desirable
(D) Acid test ratio = 1 is desirable
Which of the following is not a component of income statement
(A) Expenses
(C) Returns
(90)
(B) Capital turnover ratio
(D) (a) and (c)
Which of the following statement is True ?
(A) Current ratio = 1 is desirable
(C)Working ratio = 1 is desirable
(89)
(B) Character
(D) Commonsense
(B) Promissory note
(D) Chattal loan
Which of the following is not an higher financing agency ?
(A)IBRD
(B) RBI
(D) NABARD
(C) RRB
PARAS AHIR
11
Ag. Econ 3.2
(92)
(93)
(94)
When there is break even in the business, it is advisable for the financial
institution
(B) To recommend the farmer to
(A) To consider that farmer is not
depend solely on private money
credit worthy
lenders
(C) To recommend the farmer to
(D) To lend ST loan to the farmer
stop the business temporarily
Which of the following is not a programme executed for rural
development
(A) SFDA
(B) AREIF
(C) IRDP
(D) MFAL
The concept of SHGs came into existence due to the fact that
(A) Small and marginal need
financial assistance for
consumption purposes
(C) The Cost of credit is low for
small and marginal farmers for
availing ST and MT loans
(95)
(B) ICF
(D) IFC
Which of the following is not regulated by RBI ?
(A) CRR
(C) IRR
(98)
(B) Open loan
(D)Indirect loan
Which of the following is not a constitution of World bank ?
(A) IDA
(C) IMF
(97)
(D) All the above
The loan and advanced by a bank to drip irrigation firm is called as
(A) Pledge loan
(C) Chattal Loan
(96)
(B) Majority of small and marginal
farmers are not credit worthy
(B) Bank rate
(D) Reverse rapo rate
LAMPS came into existence in the year __________
(A)1971
(B) 1975
(D) 1972
(C)1980
PARAS AHIR
12
Ag. Econ 3.2
(99)
LAMPS came into existence to meet the credit needs of ____________
(A) Weaker section
(C) Medium farmer
(100)
(B) Large farmer
(D) Tribal farmer
The jurisdiction of LAMPS is _______
(A) 1 district
(B) 1 Village
(C) 1 taluka
(D)none
(101) LAMPS came to into existence based on the recommendation of ______
team
(A) B. Siva Raman
(B) Bawa
(C) NCA
(D) M. Narasimham
(102)
Which of the following is not a component of cost of credit ?
(A) Loan amount
(B)Interest
(C) Loss of opportunity wage
(D) All
earing
(103) Among the following the Impact of cost of credit is more on _______
farmer
(A) Small
(B) Medium
(C) Large
(D) None
(104) To check the higher impact of cost of all credit on the part of small
farmers, _______ scheme came into existance
(A) KCC
(B) DIR
(C) SLGS
(D) All
(105) DIR scheme was proposed to check one of the following on the part of
small farmers
(A) Transportation charges from
(B) Loss of opportunity wage earning
village to bank
(D) Unauthorized payments by
(C)Cost of credit
farmers
(106)
DIR scheme was proposed by ________ committee
(A) B. K. Hazare
(C)Mohan Khanda
(B) B. Siva Raman
(D) V. L. Mehta
PARAS AHIR
13
Ag. Econ 3.2
(107)
A line-of-credit loan to purchase fertilizer is
(A) A mortgage
(C) A consumer loan
(108)
At low interest rates,
(A) The demand for credit is low
(C) The quantity of credit
demanded is high
(109)
(B) Decrease in Non- equity capital
(D) Improvement in soil fertility
Which of the following is quoted as ‘Double-edged knife’?
(A) Credit
(C) Cost of credit
(112)
(B) Cost of credit
(D)Leverage
Risk in farm business increase with
(A) Increase n Equity Capital
(C) Leverage
(111)
(B) The demand for credit is high
(D) The quantity of credit demanded
is low
The ratio between non-equity capital to equity capital is called
(A) Equity
(C) Liquidity
(110)
(B) An operating loan
(D) A long term loan
(B) Interest
(D) All
Series of periodic loan payments is an example of a/an
(A) Fixed future value
(B) Net Present value
(C) Annuity
(D) None
(113) A loan which is repaid from the assets originally purchase with the loan is
a
(A)Lease
(B) Self-liquidity loan
(C) Discount value
(D) Balloon loan
(114)
A producer most often uses a cash flow statement to ________
(A) Estimate the amount of
credit needed and when it is
needed
(C)Estimate potential cash
overflow
(B) Determine equipment needs
(D) Estimate when debt payments
will come due
PARAS AHIR
14
Ag. Econ 3.2
(115) The incremental income due to loan investment can be worked out by
using
(A)Cobb-douglas production
(B) partial budgeting technique
function
(C)Linear programming
(D) Compound growth rate
techniques
(116) Which of the following is inversely related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Size of holding
(C) Family expenses
(D) All
(117) Which of the following is inversely related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Size of holding
(C)Farm working expenses
(D) All
(118) Which of the following is directly related to repayment capacity of the
farmer-borrower ?
(A)Gross return
(B) Farm working expenses
(C) Family expenses
(D) All
(119) The following is/are the important reasons for poor repayment capacity
of the farmer-borrower in India.
(A) Small size holding
(B) Higher family expenditure
(C) Higher farm working expenses (D) All
(120) Which of the following improves the repayment capacity of the farmerborrower ?
(A) Improving net worth of farm
(B) Crop diversification
business
(C )Adopting modern technology
(D) All
in the farm
(121) The adjustment of gross income of farm-business to its coefficient of
variation in the project area is called
(A) Risk bearing ability
(B) Deflation
(C) Inflation
(D) Stagflation
(122)
Indian banks have the maximum foreign branches in
(A) Bangladesh
(C) U. K.
(B) U.S.A.
(D) Sri Lanka
PARAS AHIR
15
Ag. Econ 3.2
(123) While estimating the ________ of the farmer-borrower, gross return is
deflated
(A) Repayment capacity
(B) Risk bearing ability
(C) Returns
(D) Rate of return
(124) If the repayment capacity of the farmer-borrower is higher even under
risk conditions, its indicate ______ on the part of farmer-borrower.
(A) Higher Risk bearing ability
(B) High cost of credit
(C) Inadequate loan taken
(D) All of above
(125) Which of the following improves the risk bearing ability of the farmerborrower?
(A) Improving net worth of farm
(B) Encouraging saving
business
(C) Insuring enterprises
(D) All of above
(126) A cash flow budget projected for the next year can provide information
on
(A) Net worth of the farm
(B) Return to the farm operator’s
business
labor and management
(C) Projected borrowing
(D) Rate of return on the farm
requirements and repayment
investment
ability
(127)
A business is “Solvent” is
(A) Total receipts exceed total
(B) Total debt exceeds total equity
expenditures
(C) Total sales exceed total cash
(D) Total assets exceed total
expenses
liabilities
(128) Statement of projected costs and returned associated with one
production process, usually for one production period called
(A) Partial budget
(B) Enterprises budget
(C) Total farm budget
(D) Cash flow projection
(129) A physical and financial plan for the entire farm business for a specific
period of time is called
(A) Total farm budget
(B) Cash flow projection
(D) Partial budget
(C) Enterprise budget
PARAS AHIR
16
Ag. Econ 3.2
(130)
Repayment capacity best measured by the
(A) Enterprise budget
(C) Profit and loss statement
(131)
In increasing net worth can result from
(A)Increasing debt
(C) Increasing farm inventory
values
(132)
(B) projection cash flow statement
(D) Check book
(B) Decreasing farm inventory values
(D) Decreasing farm inventory values
Crop insurance provides a means of
(A) Reducing risks
(B) Lowering costs
(C) Increasing profits
(D) Increasing working capital
(133) Financial, Opportunity, cash, and economic are terms used to describe
different type of the following for a farm firm
(A) Revenues
(B) Costs
(C)Liabilities
(D) Assets
(134)
________ is the rate at which banks borrow from the RBI
(A) Bank rate
(C) Repo rate
(135)
(B) Reverse repo rate
(D) CRR
Capacity is the second ‘C’ of credit, which indicates
(A) Capacity to withstand risk
(B) Capacity to repay plan
(C) Capacity to avail marketing
(D) capacity to avail production loan
loans
(136) Which of the following ‘C’s of credit is considered as prima-facie for
sanctioning the loan by the banker to the farmer-borrower?
(A) Character
(B) Capacity
(C) Condition
(D) Commonsense
(137)
Which of the following is the first ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(B) Principal of protection
(D) Principal of productivity
PARAS AHIR
17
Ag. Econ 3.2
(138)
Which of the following is the 2nd ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(139)
(B) Principal of productivity
(D) Principal of protection
Which of the following is the fourth ‘P’ of credit ?
(A) Principal of payment
(C) Principal of phased
disbursement
(141)
(D) Principal of personality
Which of the following is the third ‘P’ of credit ?
(A) Principal of payment
(C) Principal of productive
purpose
(140)
(B) Principal of protection
(B) Principal of productivity
(D) Principal of protection
Which of the following is the fifth ‘P’ of credit ?
(A) principal of proper utilization (B) Principal of protection
(C) Principle of productive
(D) Principal of productivity
purpose
(142)
Which of the following is the sixth ‘P’ of credit ?
(A) Principal of payment
(C) Principle of productive
purpose
(143)
(D) Principal of productivity
Which of the following is the seventh ‘P’ of credit ?
(A) Principal of payment
(C) Principle of productive
purpose
(144)
(B) Principal of protection
(B) Principal of protection
(D) Principal of productivity
Principle of personality is the 2nd ‘P’ of credit, which indicates
(A) principal of proper utilization
(B) Trust worthiness borrower
(D) Risk bearing ability of farmers
(C) Productive use of loan
PARAS AHIR
18
Ag. Econ 3.2
(145) Principle of personality is the 2nd ‘P’ of credit, which directly influences
the
(A) Risk bearing ability of farmer (B) Functional efficiency of bank
(C) Productive loan utilization
(D) Insurance coverage of farmers
(146)
Principle of personality is the 6th ‘P’ of credit, which directly influence the
(A) Prompt disbursement of loan (B) Unauthorized payment of
by banks
borrower
(C) Prompt repayment of loan by
(D) All of above
borrower
(147) Under adverse climate conditions, ________ scheme repays loans to the
banks on the part of weaker sections
(A)Kisan credit card
(B)DIR scheme
(C)SLGS
(D) Crop insurance scheme
(148) Which of the following is the correct formula to complete incremental
income from the loan investment by using partial budgeting technique ?
(A) (AR+RC)-(AC+RR)
(B) (AC+RR)-(AR+RC)
(C) (AR+RR)-(AC+RC)
(D) None
(149) The concept of repayment plans will generally arise in case of _______
loans
(A) ST loans
(B) LT loans
(C) SAO loans
(D) Self liquidating loans
(150)
The concept of repayment plans will not arise in case of _______ loans
(A) MT loans
(B) LT loans
(C) ST loans
(D) Partial liquidating loans
(151) Which of the following repayment plan is also called as balloon
repayment plan
(A)Amortized decreasing
(B) Variable repayment plan
repayment plan
(D) Partial repayment plan
(C) Amortized even repayment
plan
PARAS AHIR
19
Ag. Econ 3.2
(152) In _______ repayment plan, principal amount is paid in lumpsum in the
last year and interest is paid regularly
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Variable repayment plan
plan
(153) In _______ repayment plan, the installment amount gradually decreases
over a period, but in the last, huge installment is paid
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(154) Which of the following is also called as Single/Lumpsum repayment plan
?
(A) Amortized decreasing
(B) Amortized even repayment plan
repayment plan
(C) Straight-end repayment plan (D) Partial repayment plan
(155) In _______ repayment plan, the installment amount gradually decrease,
but principal amount remains same throughout the repayment period in
the last, huge installment is paid
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(156) In ______ repayment plan, the installment amount remains same
through out the repayment period
(A) Amortized decreasing
(B) Straight-end repayment plan
repayment plan
(C) Amortized even repayment
(D) Partial repayment plan
plan
(157) Which of the following is correct with the reference to amortized
decreasing repayment plan?
(A) Installment increases,
(B) Installment decreases, Principal
Principal and
interest
and
interest increases
decreases
(C) Installment and Principal
(D) Installment and intrest decrease,
decrease, Interest remains same Principal remains same
PARAS AHIR
20
Ag. Econ 3.2
(158) Which of the following is correct with the reference to amortized even
repayment plan?
(A) Installment increases,
(B) Installment decreases, Principal
Principal and
interest
and
interest increases
decreases
(C) Installment remains same ,
(D) Installment remains same ,
Principal increase, Interest
Principal decrease, Interest increase
decrease
(159) In amortized even repayment plan of credit, the repayment of
installments are
(A) Large proportion of each
(B)small proportion of each
succeeding principal amount and succeeding principal amount and a
a smaller amount of interest
larger amount of interest
(C) Equal proportion of principle
(D) Not a set sequence
and interest
(160) In amortized decreasing repayment plan of credit, the repayment of
installments are
(A) Large proportion of each
(B)small proportion of each
succeeding principal amount and succeeding principal amount and a
a smaller amount of interest
larger amount of interest
(C) Constant principal amount
(D) Not a set sequence
and declining interest
(161) For which of the following, amortized decreasing repayment plan is
followed?
(A) Paddy loan
(B) Tractor loan
(C) Loan given for diggimg wells
(D) Machinery loan
(162)
For which of the following, amortized even repayment plan is followed ?
(A) Paddy loan
(B) Tractor loan
(C) Loan given for diggimg wells (D) Machinery loan
(163) In _______ repayment plan, the size of installment paid depends upon
the level of income from the agri-business
(A) Amortized decreasing
(B) straight-end repayment plan
repayment plan
(D) variable repayment plan
(C) Amortized even repayment
plan
PARAS AHIR
21
Ag. Econ 3.2
(164)
Reverse repayment plan is also called _________
(A) Amortized decreasing
(B) Future repayment plan
repayment plan
(C) Amortized even repayment
(D) partial repayment plan
plan
(165) In _______ repayment plan, facility is given to the farmer-borrower to
pay advanced installments at times of good harvest and no payment at
times of poor harvest
(A) Amortized decreasing
(B) Amortized even repayment plan
repayment plan
(C) Reserve repayment plan
(D) variable repayment plan
(166) The payment plan generally followed by the banking institution in areas
where agri-business income shows higher degree of variability
(A) Reserve repayment plan
(B) Amortized even repayment plan
(C) Amortized decreasing
(D) variable repayment plan
repayment plan
(167)
Repayment of loans in a series of installments is called ________
(A) Liquidity
(C) Leverage
(168)
Net worth statement is also called as ________
(A) Income statement
(C) cash flow statement
(169)
(B) profit and loss statement
(D) Balance sheet
In net worth statement, assets are on _________ side
(A) Left
(C) Middle
(170)
(B) Amortization
(D) Hypothecation
(B) Right
(D) Not included
In net worth statement, liabilities are on ________ side
(A) Left
(B) Right
(D) Not included
(C) Middle
PARAS AHIR
22
Ag. Econ 3.2
(171) If assets are more than liabilities in Net worth statement, net worth is on
________ side
(A) Left
(B) Right
(C) Middle
(D) Not included
(172) If assets are less than liabilities in Net worth statement, net deficit is on
________ side
(A) Left
(B) Right
(C) Middle
(D) Not included
(173) ______ is the return banks earn on excess funds parked with the central
bank against Government securities
(A) Bank rate
(B) Reverse repo rate
(C) Repo rate
(D) CRR
(174) ________ is a debt security issued by a company (called issuer), which
offers to pay interest in lieu of the money borrowed for a certain period
(A) T-Bill
(B) Debunture
(C) G-Secs
(D) None
(175)
If net worth is positive for business, it indicates the business is said to be
(176)
(177)
(178)
(179)
(A) Leverage
(B) Amortized
(C) Solvent
(D) Insolvent
The financial ratio which indicates the liquidity position of the farm
business in the shortest or immediate period is called ________
(A) Intermediate ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
The financial ratio which indicates the liquidity position of the farm
business in the immediate period is called ________
(A) Acid test ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
The financial ratio which indicates the liquidity position of the farm
business in the long run period is called ________
(A) Acid test ratio
(B) Working ratio
(C) Net capital ratio
(D) Current ratio
Acid test ratio is otherwise called as __________
(A) Quick ratio
(B) Working ratio
(D) Current ratio
(C) Net capital ratio
PARAS AHIR
23
Ag. Econ 3.2
(180) An Acid Test ratio of 1 is ___________ for the business
(A) Desirable
(B) Not desirable
(C) Break even point
(D) Not meaning
(181) Income statement is otherwise called as ___________
(A) Net worth statement
(B) Cash flow statement
(C) Balance sheet
(D) Profit/Loss statement
(182) Income statement summarizes the __________ and __________ of the
farm business
(A) Assets and liabilities
(B) Flow of funds statements
(C) Income and Expenditure
(D) Equity and Non equity capital
(183) Cash flow statement is otherwise called as _________
(A) Net worth statement
(B) Flow of funds statement
(C) Balance sheet
(D) Profit/Loss statement
(184) _________ is prepared to overcome the deficiencies in NWS and income
statement
(A) Net worth statement
(B) Profit/Loss statement
(C) Balance sheet
(D) Flow of funds statement
(185) _________ is the financial statement prepared for the future
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(186) Net income, net operating income and net farm income can be
calculated from ________ statement
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(187) _________ financial statement enables the farmer to plan the
ernterprises and procurement of resources in advances
(A) Net worth statement
(B) Profit/Loss statement
(C) Flow of funds statement
(D) Balance sheet
(188) Which of the following statements about growth of credit and deposits
of banks in 2010-11 is/are correct ?
I.
Credit growth
II.
Deposit growth was 32.11 per cent
III.
Credit growth was higher than at 15.84 per cent
(A) I only
(B) II and III only
(D) I and II only
(C) II only
PARAS AHIR
24
Ag. Econ 3.2
(189) The asian development Bank(ADB) has scaled down its projection for
india’s economic growth in 2011-12 to _______ recently.
(A) 6.3 per cent
(B) 6.8 per cent
(C) 8.2 per cent
(D) 7.6 per cent
(190) Which state has the highest number of operational special economic
Zones (SEZs) as per recent information from the ministry of commerce
and industry?
(A) Kerala
(B) Tamil Nadu
(C) Karnataka
(D) Andhra Pradesh
(191) When a farmer prepared a list of expected income and expenses for
next year, he has developed
(B) A financial statement and a
(A) Income tax report
projected cash flow
(C) An inventory
(D) A projected cash flow
(192) CADA came into existence in _________ five year plan
(A) III
(B) V
(C) VII
(D)IV
(193) Liquidity is Best described as
(A) Total assets minus total
(B) The ability to meet cash
liabilities
obligations as they come due
(C) Having no long term debt
(D) The rate of capital turn-over
(194) IRDP is basically a/an
(A) varietal improvement
(B) Crop insurance programme
programme
(C) Drought relief programme
(D) Anti-poverty programme
(195) Under SFDA and MFAL, the percent subsidy to small farmer is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(196) Under SFDA and MFAL, the percent subsidy to marginal farmer and
agricultural laborers is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(197) Under IRDP, the percent subsidy to small farmer is _______ %
(A) 10
(B) 25s
(D) 33.3
(C) 50
PARAS AHIR
25
Ag. Econ 3.2
(198) Under IRDP, the percent subsidy to marginal farmer is _______ %
(A) 10
(B) 25
(C) 50
(D) 33.3
(199) Repayment capacity best measured by the
(A)Enterprise budget
(B) Profit and loss statement
(C)Projected cash flow statement (D) Check book
(200) Which of the following is permanent programme ?
(A) IRDP
(B) CADA
(C) SFDA and MFAL
(D) DPAP
PARAS AHIR
26