Question : Which measure(s) is the Reserve Bank most likely to take to combat inflation in the economy?
A) Increase repo rate
B) Increase money supply
C) Decrease cash reserve ratio
Option 1: Only A
Option 2: Both B and C
Option 3: Only B
Option 4: Both A and C
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Correct Answer: Only A
Solution : The correct answer is Only A.
The repo rate is the interest rate that the central bank of a nation—in India, the RBI—uses to lend money to commercial banks in times of financial crisis. To control inflation and deflation, the Bank of India (RBI) uses a variety of monetary policy tools, including the market stabilisation scheme, cash reserve ratio (CRR), bank rate, repo rate, reverse repo rate, open market operations, statutory liquidity ratio (SLR), and liquidity adjustment facility (LAF).
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Question : The rate at which the Reserve Bank of India lends to other commercial banks for the short term has been reduced. What is this rate called?
Question : Which of the following is a qualitative measure of credit control used by the Reserve Bank of India?
A) CRR B) Moral Suasion C) SLR
Question : Which among the following is correct about the Reverse Repo Rate?
Question : Which of the following is included in the M1 measure of money supply?
A) Currency with Public
B) Time Deposit with Post Office
C) Demand Deposits with Commercial Banks/RBI of Public Financial Institutions
Question : In India, _____fixes the Cash Reserve Ratio(CRR) for the banks in the economy.
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