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CMA Foundation Economy & Banking Awareness Questions
Practise economy & banking awareness (general awareness) for the Cost & Management Accountancy Foundation Examination: 10 multiple-choice questions, each with the correct answer and a worked explanation. Click an option to check it, or “New questions” for another set.
Economy & Banking Awareness practice
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Q1.Which type of account typically earns no interest in India?
Show answer & explanation
Answer: C — Current account
Current accounts for businesses usually pay no interest.
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Q2.A Non-Performing Asset (NPA) in India is a loan overdue for more than:
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Answer: A — 90 days
Under RBI norms a loan becomes an NPA when interest or principal is overdue for more than 90 days.
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Q3.UPI in India stands for:
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Answer: B — Unified Payments Interface
UPI, run by NPCI, enables instant bank-to-bank payments.
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Q4.Stagflation is a combination of:
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Answer: A — Stagnant growth and high inflation
Stagflation = stagnant economic growth + high inflation + often high unemployment.
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Q5.Which body regulates the securities market in India?
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Answer: B — SEBI
The Securities and Exchange Board of India (SEBI).
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Q6.Inflation that is very high and accelerating is called:
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Answer: C — Hyperinflation
Hyperinflation is extremely rapid price growth (often >50% a month).
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Q7.The headquarters of the World Bank is in:
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Answer: B — Washington, D.C.
The World Bank Group is based in Washington, D.C.
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Q8.Which instrument is used for transferring money electronically in real time for large values in India?
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Answer: D — RTGS
RTGS settles individual large-value transactions in real time.
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Q9.Fiscal deficit refers to:
Show answer & explanation
Answer: C — Total expenditure minus total receipts excluding borrowings
Fiscal deficit = total expenditure − total receipts (excluding borrowings): the government’s borrowing requirement.
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Q10.Which ratio measures a bank’s capital against its risk-weighted assets?
Show answer & explanation
Answer: B — CAR (CRAR)
Capital Adequacy Ratio = capital ÷ risk-weighted assets (Basel norms).
How to approach economy & banking awareness questions
Know what each regulator does (RBI, SEBI, IRDAI, PFRDA), the policy tools (repo, CRR, SLR) and the definitions behind GDP, inflation and fiscal deficit. Check current rates in the latest official releases.
About CMA Foundation
Cost & Management Accountancy Foundation Examination — conducted by Institute of Cost Accountants of India (ICMAI). The entry level of the CMA course, covering accounting, law, business mathematics and statistics.
Original practice questions written for this site in the style and difficulty of each exam’s syllabus. They are not past papers and the site is not affiliated with any exam body. Exam patterns, marking schemes and syllabi change — always check the latest official notification.
CMA Foundation practice topics
| Topic | Section | Question source |
|---|---|---|
| Accounting & Finance | Finance | Calculated + question bank |
| Simple & Compound Interest | Quantitative aptitude | Calculated (new numbers every set) |
| Averages & Statistics | Quantitative aptitude | Calculated (new numbers every set) |
| Economy & Banking Awareness | General awareness | Question bank |