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5 In the question given below, there are two statements 1
marked as Assertion (A) and Reason (R). Read the
statements and chose the correct option: (HOTS)
Assertion (A): There is no organization which supervise the credit activities of lenders in the
informal setor.
Reason (R): They can lend at whatever interest rate they choose. There is no one to stop them
from using unfair means to get their money back.
Options:
A. Both A and R are true and R is the correct explanation of A.
B. Both A and R are true but R is not the correct explanation of A.
C. A is correct but R is wrong.
D. A is wrong but R is correct.
6 There is no organization which supervises the credit activities of the lender in the informal 1
sector. They can lend at whatever interest rate they choose. There is no one to stop them from
using unfair means to get their money back. (A)
Analyse the loan information given above, considering one of the following correct option.
(a) Higher rate of interest charged by informal sector or credit.
(b) Banks charges less rate of interest.
© RBI should monitored informal sector of credit
(d) both b and c.
7 Manav needs a loan to set up a small business. On what basis will Manav decide whether to 3
borrow from the bank or the moneylender? Discuss. (A)

8 “Most of the poor households are still dependent on informal sources of credit‟. Explain the 3
statement. (HOTS)
OR
Why are the poor households still dependent on informal sources of credit ? Explain.

9 Q- What are 'Self-help Groups'? How do they work? Explain. (A) 3

10 What are the differences between formal and informal sources of credit? (A) 5

11 What is the basic idea behind the SHG ? How does an SHG function? Apart from generating 5
credit, how has the SHG s helped the rural poor? (HOTS)