Banking Interview Questions 2014 Part-3

1. What is Fiscal Deficit?
It is the difference between the government’s total receipts (excluding borrowings) and total expenditure.

2 What is Revenue deficit?
It defines that, where the net amount received (by taxes & other forms) fails to meet the predicted net amount to be received by the government.

3. What is GDP?
The Gross Domestic Product or GDP is a measure of all of the services and goods produced in a country over a specific period; classically a year.

4. What is GNP?
Gross National Product is measured as GDP plus income of residents from investments made abroad minus income earned by foreigners in domestic market.

5. What is National Income?
National Income is the money value of all goods and services produced in a country during the year.

6. What is Per Capita Income?
The national income of a country, or region, divided by its population. Per capita income is often used to measure a country's standard of living.

7. What is SEZ?
SEZ means Special Economic Zone is the one of the part of government’s policies in India. A special Economic zone is a geographical region that economic laws which are more liberal than the usual economic laws in the country. The basic motto behind this is to increase foreign investment, development of infrastructure, job opportunities and increase the income level of the people.

8. Functions of RBI?
The Reserve Bank of India is the central bank of India, was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934. The Reserve Bank of India was set up on the recommendations of the Hilton Young Commission. The commission submitted its report in the year 1926, though the bank was not set up for nine years.To regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage." Banker to the Government: performs merchant banking function for the central and the state governments; also acts as their banker.Banker to banks: maintains banking accounts of all scheduled banks. 

9. What is monetary policy? A Monetary policy is the process by which the government, central bank, of a country controls (i) the supply of money, (ii) availability of money, and (iii) cost of money or rate of interest, in order to attain a set of objectives oriented towards the growth and stability of the economy. 

10. What is Fiscal Policy? Fiscal policy is the use of government spending and revenue collection to influence the economy. These policies affect tax rates, interest rates and government spending, in an effort to control the economy. Fiscal policy is an additional method to determine public revenue and public expenditure.