Question : Which of the following statement are true?
- Sale of government securities by the central bank in the open market is an appropriate policy to check depression in the economy.
- Deficiency in demand has no effect on the country’s output and price.
Option 1: Both are true.
Option 2: Both are false.
Option 3: Statement 1 is true, statement 2 is false.
Option 4: Statement 1 is false, statement 2 is true.
Answer (1)
22nd Jan, 2024
Correct Answer:
Both are false.
Solution :
To check depression, the central bank should purchase government securities from the open market
Deficiency in demand leads to fall in the country’s output and price.
Hence, Option B is correct.
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