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The term 'rupee' derives from the Sanskrit word 'rūpya', which signifies 'shape' or 'likeness'.
Answer: False
Explanation: While 'rūpya' can relate to shape or likeness, its primary etymological meaning in the context of currency is 'wrought silver'.
Pāṇini's grammatical works contain the earliest known textual reference to coins designated as 'rūpya'.
Answer: True
Explanation: The writings of the ancient Indian grammarian Pāṇini are indeed cited as providing the earliest known textual reference to coins named 'rūpya'.
The Arthashastra references copper coinage as 'tāmrarūpa' and gold coinage as 'suvarnarūpa'.
Answer: False
Explanation: The Arthashastra mentions copper coins as 'tāmrarūpa' and gold coins as 'suvarṇarūpa', but the question incorrectly states 'suvarnarūpa'.
What is the primary etymological meaning of the Sanskrit word 'rūpya', the root of the term 'rupee'?
Answer: Wrought silver
Explanation: The Sanskrit word 'rūpya', from which 'rupee' is derived, primarily signifies 'wrought silver'.
Which ancient Indian text is cited as mentioning silver coins as 'rūpyarūpa', alongside other denominations such as gold and copper coins?
Answer: The Arthashastra
Explanation: The Arthashastra, a treatise on statecraft and economics, is cited for its mention of silver coins as 'rūpyarūpa', alongside references to gold and copper denominations.
Sher Shah Suri instituted a silver coin, designated the 'Rupiya', weighing approximately 178 grains.
Answer: True
Explanation: Sher Shah Suri's reign (1540-1545) saw the introduction of the 'Rupiya', a silver coin standardized at approximately 178 grains.
Mughal rulers in 1604-1605 exclusively issued coins featuring Islamic calligraphy, thereby avoiding any depiction of deities.
Answer: False
Explanation: The assertion that Mughal rulers exclusively used Islamic calligraphy and avoided deities on coins in 1604-1605 is incorrect. Historical records indicate that coins from this period featured depictions of Hindu deities, such as Ram and Sita.
The silver coin initially introduced by Sher Shah Suri maintained its currency through the Maratha era and into the early period of British India.
Answer: True
Explanation: The silver coin, initially termed 'Rupiya' by Sher Shah Suri, remained in circulation and influence throughout the Mughal period, the Maratha era, and into British India.
During the 19th century, India's adherence to a silver standard rendered its currency less stable relative to economies that had adopted the gold standard.
Answer: True
Explanation: India's reliance on a silver standard throughout much of the 19th century led to its currency's value being less stable compared to economies that had adopted the gold standard.
Prior to decimalization, the Indian rupee was divided into 16 annas, with each anna further divided into 4 pices.
Answer: True
Explanation: The pre-decimal system divided the rupee into 16 annas, and each anna was further subdivided into 4 pices.
During World War II, India began minting standard rupee coins from pure nickel as a measure to conserve silver.
Answer: False
Explanation: This statement is false. During World War II, India utilized 'Quaternary Silver Alloy' for its rupee coins starting in 1940 to conserve silver. Pure nickel coins were introduced later, in 1947.
The first coinage of the Republic of India, introduced in 1950, featured the tiger motif on the one rupee coin.
Answer: False
Explanation: This assertion is incorrect. The first coinage of the Republic of India, introduced in 1950, replaced the tiger motif on the one rupee coin with a corn sheaf and featured Ashoka's Lion Capital.
Due to inflationary pressures in the 1960s, Indian coins composed of bronze and nickel were replaced by coins minted from gold.
Answer: False
Explanation: This statement is inaccurate. During the 1960s, inflationary pressures led to the replacement of coins made from bronze and nickel-brass with those made from aluminium, not gold.
The 1, 2, and 3 paise denominations of Indian coinage were discontinued in the early 1980s.
Answer: False
Explanation: The 1, 2, and 3 paise coins were gradually discontinued in the 1970s, not the early 1980s, due to cost-benefit considerations.
Stainless steel coinage was introduced for the one rupee denomination in India in 1988.
Answer: False
Explanation: This statement is incorrect. While stainless steel coinage was introduced in 1988 for 10, 25, and 50 paise denominations, the one rupee coin made of stainless steel was introduced later, in 1992.
Sher Shah Suri issued a notable silver coin during his reign (1540-1545). What was its approximate weight?
Answer: 178 grains
Explanation: The silver coin, known as the 'Rupiya', introduced by Sher Shah Suri during his rule, weighed approximately 178 grains.
What distinctive feature is noted concerning certain Mughal coins issued circa 1604-1605?
Answer: They honored Hindu deities like Ram and Sita.
Explanation: In 1604-1605, certain Mughal coins were issued featuring depictions of Hindu deities, specifically Ram and Sita, in both silver and gold.
Which historical periods witnessed the continued circulation of the silver coin initially introduced by Sher Shah Suri?
Answer: The Mughal period, Maratha era, and British India
Explanation: The silver coin standard established by Sher Shah Suri persisted through the Mughal period, the Maratha era, and into the era of British India.
How did India's adherence to a silver standard in the 19th century impact its currency's stability relative to major global economies operating on the gold standard?
Answer: It led to its value being less stable compared to economies on the gold standard.
Explanation: India's reliance on a silver standard in the 19th century resulted in greater volatility and less stability for its currency when compared to economies that had adopted the gold standard.
Prior to India's adoption of a decimal currency system, how many pices constituted one rupee?
Answer: 192 pices
Explanation: In the pre-decimal system, one rupee was equivalent to 16 annas, and each anna comprised 4 pices, totaling 192 pices per rupee.
During World War II, what material was utilized for standard rupee coins starting in 1940 as a measure to conserve silver?
Answer: Quaternary Silver Alloy
Explanation: To conserve silver during World War II, India began minting rupee coins from a 'Quaternary Silver Alloy' starting in 1940.
What imagery superseded the King's effigy on the inaugural coinage of the Republic of India, introduced in 1950?
Answer: Ashoka's Lion Capital
Explanation: The first coinage of the Republic of India, introduced in 1950, replaced the King's image with the Ashoka's Lion Capital.
What alteration occurred in the 1960s concerning the materials employed for small denomination Indian coins?
Answer: Coins made from metals like bronze and nickel were replaced by aluminium coins.
Explanation: During the 1960s, inflationary pressures led to the replacement of small denomination coins made from bronze and nickel-brass with those minted from aluminium.
The Bank of Hindostan, founded in 1770, represents one of the earliest institutional issuers of paper currency in India.
Answer: True
Explanation: Established in 1770, the Bank of Hindostan was indeed among the pioneering institutions to issue paper rupees in India.
In the 1990s, coins replaced higher denomination banknotes like the ₹10 note due to the high cost of managing banknotes.
Answer: False
Explanation: This statement is inaccurate regarding the denomination. In the 1990s, coins replaced lower denomination banknotes (₹1, ₹2, and ₹5) due to the high cost of managing these notes, not higher denominations like the ₹10 note.
The 'Commerce series' banknotes issued by the Bank of Bengal featured text in English, Persian, and Tamil.
Answer: False
Explanation: This statement is false. The 'Commerce series' banknotes issued by the Bank of Bengal featured text in English, Urdu, and Bengali, not Persian and Tamil.
The Paper Currency Act of 1861 vested the sole authority for issuing banknotes in the Government of British India.
Answer: True
Explanation: The Paper Currency Act of 1861 established the monopoly of the Government of British India over the issuance of banknotes.
The 'Victoria Portrait' series banknotes, the first British Indian notes, were printed on one side only.
Answer: True
Explanation: The 'Victoria Portrait' series banknotes, which constituted the first British Indian notes, were indeed printed on one side only (unifaced).
The 'Underprint series' was introduced in British India as a successor to the 'Victoria Portrait' series, prompted by widespread instances of forgery.
Answer: True
Explanation: The 'Underprint series' was issued in British India starting in 1867 to replace the 'Victoria Portrait' series, which had been withdrawn due to a significant number of forgeries.
The George V series banknotes, introduced in 1923, encompassed denominations including ₹1, ₹5, and ₹10,000.
Answer: True
Explanation: The George V series banknotes, first issued in 1923, included a range of denominations, notably ₹1, ₹5, and the high-value ₹10,000 note.
The Reserve Bank of India issued its first banknote, a five rupee note, in 1935.
Answer: False
Explanation: This statement is incorrect. The Reserve Bank of India issued its first banknote in 1938, not 1935. The first note issued was a five rupee note.
The one-rupee note was reintroduced in August 1940 as a standard government note, distinct from the rupee coin.
Answer: False
Explanation: This statement is false. The one-rupee note reintroduced in August 1940 was issued as a government note that carried the status of a rupee coin, rather than being distinct from it.
During World War II, a security thread was introduced on Indian banknotes for the first time as a measure to combat Japanese forgeries.
Answer: True
Explanation: To counter Japanese forgeries during World War II, Indian banknotes incorporated a security thread for the first time, alongside other security enhancements.
Hindi commenced its prominent inclusion on Indian banknotes beginning in 1953.
Answer: True
Explanation: Hindi began to be prominently featured on new Indian banknotes starting in the year 1953.
In 1967, Indian banknotes were reduced in size to accommodate new security features.
Answer: True
Explanation: Due to economic conditions in the late 1960s, Indian banknotes were reduced in size in 1967.
High denomination banknotes, including the ₹10,000 note, were demonetized in India in 1978.
Answer: True
Explanation: In 1978, India demonetized high denomination banknotes, such as the ₹10,000 note, as part of currency management measures.
The 'Mahatma Gandhi Series' banknotes, introduced in 1996, incorporated intaglio features specifically designed for the visually impaired.
Answer: True
Explanation: The 'Mahatma Gandhi Series' banknotes, launched in 1996, featured several advanced security elements, including intaglio printing designed to assist the visually impaired.
Which of the following entities was NOT among the earliest institutions to issue paper rupees in India, according to the text?
Answer: Reserve Bank of India
Explanation: The Bank of Hindostan, General Bank of Bengal and Bihar, and Bengal Bank were among the earliest issuers of paper rupees. The Reserve Bank of India commenced issuing banknotes later.
What was the primary reason for the gradual replacement of ₹1, ₹2, and ₹5 banknotes with coins during the 1990s?
Answer: Because the cost of managing these low-denomination banknotes was considerable.
Explanation: The considerable expense associated with the management and circulation of low-denomination banknotes (₹1, ₹2, ₹5) prompted their gradual replacement by coins in the 1990s.
The 'Underprint series' banknotes, introduced in 1867, were issued as a replacement for which earlier banknote series, owing to prevalent forgery concerns?
Answer: The Victoria Portrait series
Explanation: The 'Underprint series' banknotes, introduced in 1867, served as a replacement for the 'Victoria Portrait' series due to widespread issues with forgery.
Which series of banknotes, introduced in 1996, incorporated advanced features such as a windowed security thread and intaglio elements designed for the visually impaired?
Answer: The Mahatma Gandhi Series
Explanation: The 'Mahatma Gandhi Series' of banknotes, introduced in 1996, featured enhanced security elements, including a windowed security thread and intaglio features for the visually impaired.
At the time of India's independence in 1947, the Indian rupee was pegged to the US dollar at a rate of approximately ₹4.76 per dollar.
Answer: False
Explanation: This statement is incorrect. At India's independence in 1947, the rupee was pegged to the Pound Sterling. The rate of ₹4.76 per US dollar was established following the devaluation of the rupee in 1949, after the Pound Sterling's devaluation.
The devaluation of the Pound Sterling in 1949 prompted India to devalue the rupee, establishing a new exchange rate of ₹4.76 per US dollar.
Answer: True
Explanation: When the Pound Sterling was devalued in 1949, India, as part of the sterling area, devalued the rupee accordingly, resulting in the new exchange rate of ₹4.76 per US dollar.
Subsequent to the 1966 devaluation, the Indian rupee was officially exchanged at a rate of ₹7.50 to the US dollar.
Answer: True
Explanation: Following the significant devaluation of the Indian rupee in 1966, the official exchange rate was adjusted to ₹7.50 per US dollar.
The 1966 devaluation of the Indian rupee was primarily precipitated by factors including a severe drought and a reduction in foreign aid.
Answer: True
Explanation: The 1966 devaluation was necessitated by multiple factors, including trade deficits, budget deficits leading to inflation, reduced foreign aid, and the impact of a severe drought.
By 1975, the Indian rupee's exchange rate regime had transitioned from a fixed peg against the US dollar.
Answer: True
Explanation: Following global currency adjustments in the early 1970s, India moved its exchange rate system away from a fixed peg, and by 1975, it operated under a basket peg arrangement.
India's balance of payments crisis in 1991 was intensified by critically low foreign exchange reserves, estimated to be sufficient for merely three weeks of imports.
Answer: True
Explanation: The severe balance of payments crisis in 1991 was significantly exacerbated by foreign exchange reserves that were perilously low, barely covering three weeks of essential imports.
Between 2000 and 2007, the Indian Rupee exhibited a consistent decline in value relative to the US dollar.
Answer: False
Explanation: This statement is incorrect. From 2000 to 2007, the Indian Rupee stabilized and ceased its decline against the US dollar, fluctuating within a specific range and even reaching a record high by late 2007.
The depreciation of the Indian Rupee in early 2013 was primarily linked to stagnant economic reforms and a decline in foreign investment.
Answer: True
Explanation: The depreciation of the Indian Rupee in early 2013 was indeed primarily attributed to stagnant economic reforms and a reduction in foreign investment inflows.
At the conclusion of 1969, the Indian Rupee held a value of approximately 18 pence relative to the British Pound Sterling.
Answer: False
Explanation: This statement is incorrect. At the end of 1969, the Indian Rupee was valued at approximately 13 British pre-decimal pence against the Pound Sterling, not 18 pence.
Between the end of 1969 and the end of 1989, the Indian Rupee significantly strengthened against the British Pound.
Answer: False
Explanation: This statement is false. Between the end of 1969 and the end of 1989, the Indian Rupee significantly weakened, or depreciated, against the British Pound.
In January 2014, the exchange rate approximated 61.86 Indian Rupees per US Dollar.
Answer: True
Explanation: In January 2014, the exchange rate between the Indian Rupee and the US Dollar was approximately 61.86 INR per USD.
By November 2020, the exchange rate was approximately 74.31 Indian Rupees per US Dollar.
Answer: True
Explanation: By November 2020, the exchange rate had depreciated to approximately 74.31 Indian Rupees per US Dollar.
In July 2022, the Indian Rupee experienced fluctuations against the US dollar, reaching a low point of 79.27 on July 5th.
Answer: True
Explanation: During July 2022, the Indian Rupee saw considerable fluctuation against the US dollar, notably hitting a low of 79.27 on July 5th.
The projected exchange rate for early February 2025 approximated 87.29 Indian Rupees per US Dollar.
Answer: True
Explanation: Projections indicated that by early February 2025, the exchange rate would approximate 87.29 Indian Rupees per US Dollar.
What was the principal reason cited for the devaluation of the Indian rupee in 1991?
Answer: Balance of payments problems, low reserves, and high inflation.
Explanation: The devaluation of the Indian rupee in 1991 was primarily driven by severe balance of payments issues, critically low foreign exchange reserves, and high inflation.
In late 2007, the Indian Rupee attained a record high against the US dollar, approximating:
Answer: ₹39
Explanation: In late 2007, driven by strong foreign investment, the Indian Rupee reached a record high against the US dollar, trading at approximately ₹39 per dollar.
The Indian Rupee's exchange rate against the US dollar in early January 2023 was approximately:
Answer: ₹82.52
Explanation: In early January 2023, the exchange rate stood at approximately 82.52 Indian Rupees per US Dollar.
In the early to mid-20th century, the Indian rupee served as the official currency in various regions, including East Africa and Southern Arabia.
Answer: True
Explanation: During the early and mid-20th century, the Indian rupee functioned as the official currency in several territories outside India, notably in East Africa, Southern Arabia, and the Persian Gulf states.
During World War II, the Japanese rupee was introduced in territories liberated by the Indian National Army, superseding the British Indian rupee.
Answer: True
Explanation: In areas liberated by the Indian National Army during World War II, such as parts of Mizoram and Manipur, the Japanese rupee was indeed introduced, replacing the British Indian rupee.
Following India's independence, the Indian rupee remained legal tender in Pakistan until the mid-1960s.
Answer: False
Explanation: While the Indian rupee was adopted as the national currency after India's independence, it did not remain legal tender in Pakistan until the mid-1960s. Pakistan adopted its own currency, the Pakistani Rupee, shortly after independence.
The Gulf Rupee was introduced in 1959 primarily to curb gold smuggling activities, rather than solely to facilitate trade.
Answer: True
Explanation: The Gulf Rupee was introduced in 1959 not primarily to facilitate trade, but as a strategic measure to curb rampant gold smuggling activities.
Oman, Qatar, and the United Arab Emirates subsequently replaced the Gulf Rupee with their own national currencies following India's 1966 rupee devaluation.
Answer: True
Explanation: Following India's devaluation of the rupee in June 1966, Oman, Qatar, and the United Arab Emirates (then the Trucial States) transitioned to their own distinct currencies.
The 'Osmania Sicca' was the currency of Hyderabad State, not Mysore, prior to its integration into India.
Answer: True
Explanation: The 'Osmania Sicca' served as the official currency of the princely state of Hyderabad before its incorporation into the Indian Union.
After Burma separated from India in 1938, the Reserve Bank of India continued to manage certain financial responsibilities related to Burma's currency, including note issuance.
Answer: True
Explanation: Post-separation in 1938, the Reserve Bank of India maintained its role as the Banker to the Government of Burma and continued to be responsible for note issuance under specific arrangements.
The Portuguese Indian Rupia was replaced in 1959 by the Portuguese Indian Escudo, not the Indian Rupee.
Answer: True
Explanation: The currency of Portuguese India, the Rupia, was replaced in 1959 by the Portuguese Indian Escudo at a specified conversion rate, not by the Indian Rupee.
According to the provided text, which of the following regions did NOT utilize the Indian rupee as its official currency during the early to mid-20th century?
Answer: The Philippines
Explanation: While East Africa, Southern Arabia, and the Persian Gulf states used the Indian rupee during this period, the Philippines did not.
What currency was introduced in regions such as Mizoram and Manipur during World War II, following their liberation by the Indian National Army (INA)?
Answer: The Japanese Rupee
Explanation: During World War II, in areas liberated by the Indian National Army, the Japanese Rupee was introduced as the currency.
Which of the following countries retained the Indian rupee as legal tender post-India's independence until the mid-1960s?
Answer: Kuwait
Explanation: Following India's independence, the Indian rupee served as legal tender in several territories, including Kuwait, until approximately the mid-1960s.
What was the principal reason cited for the introduction of the Gulf Rupee (also known as the Persian Gulf Rupee) in 1959?
Answer: To curb gold smuggling activities.
Explanation: The Gulf Rupee was introduced in 1959 primarily as a measure to combat and curb the extensive gold smuggling activities prevalent in the region.
The 'Osmania Sicca' served as the official currency of which Indian princely state prior to its integration?
Answer: Hyderabad
Explanation: The 'Osmania Sicca' was the official currency of the princely state of Hyderabad before its integration into India.
What was the currency of Portuguese India until 1959, and what currency replaced it?
Answer: Portuguese Indian Rupia
Explanation: The currency of Portuguese India until 1959 was the Portuguese Indian Rupia, which was subsequently replaced by the Portuguese Indian Escudo.
India officially transitioned to a decimal currency system in 1957, dividing the rupee into 100 units designated as 'naye paise'.
Answer: True
Explanation: India adopted its decimal currency system in 1957, dividing the rupee into 100 'naye paise' (new paise), thereby simplifying the previous structure.
The designation 'naye paise' for the rupee's subdivision persisted indefinitely following India's decimalization in 1957.
Answer: False
Explanation: The prefix 'naye' was dropped from 'naye paise' after June 1, 1964, and the subdivisions became known simply as 'paise'.
The 'pig rupee' incident arose from an engraving of King George V, where the depiction of the elephant symbol, part of the Order of the Indian Elephant, appeared distorted.
Answer: True
Explanation: The 'pig rupee' incident stemmed from a poorly executed engraving of King George V, where the elephant symbol associated with the Order of the Indian Elephant was perceived as resembling a pig, causing public offense.
India implemented decimalization in 1957, simplifying the currency structure from the previous system of 16 annas to 100 paise.
Answer: True
Explanation: In 1957, India adopted decimalization, restructuring the currency system from 16 annas to 100 paise, thereby streamlining monetary transactions.
India's demonetisation initiative in November 2016 entailed the discontinuation of ₹500 and ₹1,000 banknotes.
Answer: True
Explanation: In November 2016, India undertook a significant demonetisation measure, discontinuing the legal tender status of ₹500 and ₹1,000 banknotes.
This statement is incorrect. While the Reserve Bank of India began withdrawing ₹2,000 notes in May 2023, they continued to be legal tender until September 2023.
Answer: False
Explanation: This statement is incorrect. While the Reserve Bank of India began withdrawing ₹2,000 notes in May 2023, they continued to be legal tender until September 2023.
'Cash Coupons' were issued by several Princely States during the 1940s to address a shortage of small coins, not high-value banknotes.
Answer: True
Explanation: During the 1940s, various Princely States issued 'Cash Coupons' to alleviate a scarcity of small coins, a measure necessitated by wartime conditions affecting mint operations.
The 'Hylian rupee' is a fictional currency from the 'Legend of Zelda' video game series and has no historical basis in circulation within India.
Answer: True
Explanation: The 'Hylian rupee' is recognized as a fictional currency within the 'Legend of Zelda' franchise and does not represent any historical currency circulated in India.
What was the designated term for the 100 subdivisions of the Indian rupee immediately following the adoption of the decimal system in 1957?
Answer: Naye Paise
Explanation: Immediately after the decimalization in 1957, the 100 subdivisions of the rupee were termed 'Naye Paise' (new paise).
The 'pig rupee' incident, which provoked public outrage, was associated with a coin issued subsequent to the accession of which monarch?
Answer: King George V
Explanation: The 'pig rupee' incident occurred following the accession of King George V in 1911, due to a controversial engraving on the coinage.
What specific action did the Reserve Bank of India undertake in May 2023 concerning the ₹2,000 denomination notes?
Answer: Began withdrawing them from circulation.
Explanation: In May 2023, the Reserve Bank of India initiated the process of withdrawing ₹2,000 denomination notes from circulation.