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Question
Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): Bank money is legal tender money.
Reason (R): Cheques drawn on demand deposits can be refused by anyone as a mode of payment. Hence, demand deposits (i.e. bank money) are not legal tenders they are optional.
Options
Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
Assertion (A) is true but Reason (R) is false.
Assertion (A) is false but Reason (R) is true.
Solution
Assertion (A) is false but Reason (R) is true.
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Read the-following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): Currency and bank money are the two modern forms of money.
Reason (R): Currency is high powered money.
Match the following:
| Column I | Column II | ||
| A. | Currency | (i) | Something which is commonly used as medium of exchange |
| B. | Bank money | (ii) | Currency and demand deposits |
| C. | Money | (iii) | Bank demand deposits |
| D. | Modern form of money | (iv) | Paper notes + coins |
Distinguish between fiat money and bank money.
