Question : Which of the following is one of the Open Market Operations of the Reserve Bank of India?
Option 1: Buying and selling of bonds issued by the Government in the open market
Option 2: Buying and selling of bonds issued by commercial banks in the open market
Option 3: Only buying of bonds issued by the Government in the open market
Option 4: Only selling of bonds issued by the Government in the open market
Correct Answer: Buying and selling of bonds issued by the Government in the open market
Solution : The correct option is Buying and selling bonds issued by the Government in the open market .
Open Market Operations (OMO) refers to the buying and selling of government securities by a central bank. These operations are conducted to control the money supply, liquidity, and interest rates in the economy.
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