The currency note of Rs. 5000 in Pakistan is:
- Metallic money
- Credit money
- Near money
- Paper money
Show answer and explanation
Answer: D. Paper money
A currency note is paper money — fiat money issued by the central bank.
I.Com Economics: Money and Banking, questions with answers
Practise 68 real Federal Board questions on Money and Banking from 2023 to 2026. See the answer and explanation as soon as you answer.
68real questions
31multiple choice
5exam sessions
About Money and Banking in I.Com Economics
Money and Banking is one of the 8 main chapters in our Federal Board I.Com Economics question bank (11th and 12th class), and about 20% of its real questions come from it. Tayyari Karo has 68 real questions on this chapter from 2023 to 2026; 31 are multiple choice and marked instantly, and the rest are short and long questions with a model answer. By difficulty: 44 medium, 22 easy, 2 hard.
Work through the questions below, then open the explanation for each one. Redo the ones you missed a few days later.
Try 8 real questions
These are real past-paper questions. Think of your answer first, then open the explanation.
Maryam records her monthly food expenses. It represents which of the following functions of money?
- Medium of exchange
- Store of value
- Standard of deferred payments
- Unit of account
Show answer and explanation
Answer: D. Unit of account
Recording/measuring expenses in monetary terms uses money's function as a unit of account (measure of value).
Evolution of money was due to the need for:
- Medium of exchange
- Investment
- Credit
- Saving
Show answer and explanation
Answer: A. Medium of exchange
Money evolved primarily to overcome the difficulties of barter by providing an efficient medium of exchange.
Which of the following resolved the problem of "double coincidence of wants"?
- Trader
- Bank
- Money
- Shopkeeper
Show answer and explanation
Answer: C. Money
Money acts as a medium of exchange, eliminating the need for both parties in a barter trade to want exactly what the other offers.
Islamic economics system opposes:
- Monopoly
- Perfect competition
- Industry
- Agriculture
Show answer and explanation
Answer: A. Monopoly
Islamic economics discourages monopolistic exploitation and hoarding, favoring fair and competitive markets.
Five-rupee coin in Pakistan is:
- Credit money
- Standard money
- Token money
- Near money
Show answer and explanation
Answer: C. Token money
A coin whose face value exceeds its metal content is token money.
Differentiate between 'convertible' and 'inconvertible' paper money.
Show model answer
Convertible paper money: paper currency that can be exchanged for a fixed quantity of gold/silver (or another valuable asset) on demand at the issuing authority.
Inconvertible paper money: paper currency (fiat money) that cannot be converted into gold/silver — its value rests solely on government decree and public confidence/acceptance, as is the case with Pakistan's currency today.
Explain quantity theory of money.
Show model answer
The Quantity Theory of Money, as formulated by Irving Fisher, states that the general price level in an economy is directly and proportionately related to the quantity of money in circulation, other things (velocity of money and volume of transactions) remaining constant.
Fisher's equation of exchange: MV = PT, where M = quantity of money in circulation, V = velocity of circulation of money, P = general price level, and T = volume of transactions (real output).
Rearranged: P = MV/T. If V and T are assumed constant, then P varies directly with M — doubling the money supply roughly doubles the price level. …
The full model answer is in the app.
Sessions with Money and Banking questions
| Session | Questions |
|---|---|
| 2026 Annual | 3 |
| 2025 1st Annual | 15 |
| 2025 2nd Annual | 16 |
| 2024 Annual | 19 |
| 2023 Annual | 15 |
Common questions
What does the Money and Banking chapter cover on this page?
68 real Federal Board (FBISE) Economics questions on Money and Banking from 2023 to 2026, for 11th and 12th class. Each one shows the session it came from.
Are the answers official?
No. We could not find an official FBISE marking scheme for these papers, so the answers and explanations are written by Tayyari Karo for practice. Check anything important with your teacher or textbook.
Is it free?
You can start free with no signup. A small set of papers per subject is free, and Premium unlocks the full question bank.