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CBSE · Class 10 · Social Science

Money and Credit

Standard difficulty · 20 questions · 40 marks

Name: Date: Score: ____ / 40

Write full answers in Sections B and C. Answers are on the last page — try every question first!

Section A — Choose the correct answer8 × 1 = 8 marks
1.
Money acts as a go-between in exchange, so it is a:
  1. collateral
  2. double coincidence
  3. store of value only
  4. medium of exchange
2.
Which of these is an example of formal credit?
  1. a loan from relatives or friends
  2. a loan from an employer
  3. a crop loan from a nationalised bank
  4. a loan from a landlord
3.
What is meant by “medium of exchange”?
  1. an order to a bank to pay someone
  2. each side wants what the other has
  3. money as the go-between in exchange
  4. a group of 15–20 people pooling savings
4.
Rural loans by source in 2019, from the book’s graph: landlords 1%, other formal agencies 5%. What is the difference?
  1. 4 percentage points
  2. 9 percentage points
  3. 5 percentage points
  4. 6 percentage points
5.
A moneylender charges 4% interest a month. How much interest is due on ₹27,000 after 8 months (simple interest)?
  1. ₹35,640
  2. ₹1,080
  3. ₹86,400
  4. ₹8,640
6.
A bank lends ₹30,000 at 10% a year. How much simple interest is due after one year?
  1. ₹3,300
  2. ₹3,000
  3. ₹30,000
  4. ₹33,000
7.
A moneylender charges 6% a month; a bank charges 11% a year. How many percentage points more a year does the moneylender charge (simple interest)?
  1. 67 points
  2. 72 points
  3. 83 points
  4. 61 points
8.
A self-help group of 17 members each saves ₹190 a month. How much do they save together in 9 months?
  1. ₹216
  2. ₹1,710
  3. ₹3,230
  4. ₹29,070
Section B — Short answer8 × 2 = 16 marks
9.
Why is money called a medium of exchange?
10.
Formal or informal credit? (a) a loan from a cooperative society (b) a loan from a landlord
11.
Explain each term: (a) self-help group (b) cheque
12.
₹21,000 is borrowed for 12 months. Compare the simple interest at a moneylender’s 5% a month and a bank’s 9% a year.
13.
From the book’s 2019 graph of rural loans: moneylenders 23%, relatives and friends 7%, landlords 1%. What is the total of these three? (The formal sources together gave 66%.)
14.
A family borrows ₹60,000 from a bank at 10% simple interest a year for 4 years, pledging its house papers. How much interest is paid, and what are the house papers called?
15.
A self-help group of 15 women each saves ₹300 a month. How much is saved in a year, and how can the group use it?
16.
What is each known for? (a) the Reserve Bank of India (b) the Grameen Bank
Section C — Longer answers4 × 4 = 16 marks
17.
How do banks act as a link between savers and borrowers?
18.
Match each with its meaning: (a) debt trap (b) cheque (c) medium of exchange. Choose from: a loan that leaves the borrower worse off; an order to a bank to pay someone; money as the go-between in exchange.
19.
The book’s graph of rural loans in 2019: commercial banks 51%, cooperatives 10%, other formal 5%, moneylenders 23%, relatives and friends 7%, landlords 1%, others 3%. (a) What share came from formal sources? (b) Suppose a block’s farmers borrowed ₹76 lakh in the same shares: how much from moneylenders? (c) Why should formal credit reach more of the poor?
20.
A farmer needs ₹30,000 for a season of 6 months. (a) What is the simple interest at a moneylender’s 5% a month? (b) At a bank’s 10% a year? (c) Why might the farmer still go to the moneylender?
AmbifulWorksheets
Practice that never repeats
CBSE · Class 10 · Social Science

Answer key

Money and Credit · AW-10SS-MAC-2026-V1 · For parents — fold back or tear off before handing the sheet to your child.

QAnswerWorking
1(d) medium of exchange—
2(c) a crop loan from a nationalised bank—
3(c) money as the go-between in exchange—
4(a) 4 percentage points5 − 1
5(d) ₹8,64027,000 × 4% × 8
6(b) ₹3,00010% of 30,000
7(d) 61 points6 × 12 − 11
8(d) ₹29,07017 × 190 × 9
9It acts as a go-between, so people can exchange goods without needing a double coincidence of wants.—
10(a) formal (b) informal—
11(a) a group of 15–20 people pooling savings (b) an order to a bank to pay someone—
12moneylender ₹12,600, bank ₹1,89021,000 × 5% × 12; 21,000 × 9% × 12/12
1331%23 + 7 + 1
14₹24,000; collateral60,000 × 10% × 4
15₹54,000; to give small loans to members at reasonable interest.15 × 300 × 12
16(a) issues currency and supervises banks (b) gives credit to the rural poor in Bangladesh—
17People deposit savings and earn interest; banks lend most of these deposits to borrowers at higher interest, keeping some cash for withdrawals.—
18(a) a loan that leaves the borrower worse off (b) an order to a bank to pay someone (c) money as the go-between in exchange—
19(a) 66% (b) ₹1,748,000 (c) Informal loans carry high interest and can trap borrowers in debt.51 + 10 + 5; 23% of ₹7,600,000
20(a) ₹9,000 (b) ₹1,500 (c) The bank may need collateral and documents the farmer does not have.—