Free Rural Development 03 Practice Test - 12th Grade - Commerce 

Question 1

Short-term loans are required for purchasing machinery, constructing fences and digging wells. Such loans are generally stretched over a period of 12 months to 3 years.  

A.

True

B.

False

SOLUTION

Solution : B

False. Medium-term loans are required for purchasing machinery, constructing fences and digging wells. Such loans are generally stretched over a period of 12 months to 5 years. 

Question 2

Which of the following is wrong regarding NABARD?

A.

It helps farmers directly

B.

It perform all the functions of RBI with regards to agriculture credit

C.

It helps the flow of credit through co-operative banks, RRB’s etc

D.

Maintain a research and development fund to promote research in agriculture 

SOLUTION

Solution : A

NABARD does not provide any loan to individuals. It only refinances banks that give loan under specific categories in agriculture including dairy animal rearing.

Question 3

Which scheme provides adequate and timely support from the banking system to the farmers for their cultivation needs in a flexible manner

A.

KMC

B.

KMM

C.

KBC

D.

KCC

SOLUTION

Solution : D

The Kisan Credit Card (KCC) scheme is a credit scheme introduced in August 1998 by Indian banks. Its objective is to meet the comprehensive credit requirements of the agriculture sector by giving financial support to farmers. Participating institutions include all commercial banks, Regional Rural Banks, and state co-operative banks. The scheme has short-term credit limits for crops and term loans. 

Question 4

Rural population needs a long-term loan for

A.

For buying fertilizers

B.

For making minor improvements on land

C.

To buy seeds

D.

For buying agricultural machinery

SOLUTION

Solution : D

Rural population needs long term loan for buying agricultural machinery.

Question 5

Microcredit programme refers to 

A.

Credit provision made by small farmers

B.

Credit provisions made by self help group to its members

C.

Credit provision made by large farmers

D.

None

SOLUTION

Solution : B

Microcredit is used to describe small loans granted to low income individuals that are excluded from the traditional banking system. It is part of the larger microfinance industry, which provides not only credit, but also savings, insurance, and other basic financial services to the poor.

Question 6

What is the 'collateral' demand that lenders make against loans?

A.

Vehicle of the borrower

B.

Building of the borrower

C.

Both (a) and (b)

D.

None of these

SOLUTION

Solution : C

Lenders demand any assets of the borrower as a collateral security.

Question 7

In a SHG, most of the decisions regarding savings and loan activities are taken by:

A.

 bank

B.

group members

C.

non-government organisation

D.

government

SOLUTION

Solution : B

SHGs are registered/unregistered entities which usually has a membership of 15 to 20 members from very low income families, usually women. They mobilize savings from members and uses the pooled funds to give loans to the needy members.

Question 8

What is the name of the success story that met the credit needs of the poor, at reasonable rates, in Bangladesh?

A.

Grameen Bank

B.

Reserve Bank

C.

Cooperative Bank

D.

None of these

SOLUTION

Solution : A

The Grameen Bank is a microfinance organisation and community development bank founded in Bangladesh. It makes small loans (known as microcredit or "grameencredit") to the impoverished without requiring collateral.

Question 9

Which of the following highlights the benefits of organic farming?
 

A.

Environment Friendly

B.

Healthier and tastier food

C.

Inexpensive process

D.

All of the above

SOLUTION

Solution : A

Organic farming is environment friendly.

Question 10

Organic produce has a
 

A.

Short life

B.

Medium life

C.

Long life

D.

Very short life

SOLUTION

Solution : A

Organic produce has a short life.

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