Economy

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11 questions

2024 · Question 53 · Monetary Policy
Consider the following statements in respect of the digital rupee : 1. It is a sovereign currency issued by the Reserve Bank of India (RBI) in alignment with its monetary policy. 2. It appears as a liability on the RBI’s balance sheet. 3. It is insured against inflation by its very design. 4. It is freely convertible against commercial bank money and cash. Which of the statements given above are correct ?
Choose your answer(a)1 and 2 only(b)1 and 3 only(c)2 and 4 only(d)1, 2 and 4
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2023 · Question 22 · Monetary Policy
Consider the following statements : Statement–I : In the post-pandemic recent past, many Central Banks worldwide had carried out interest rate hikes. Statement–II : Central Banks generally assume that they have the ability to counteract the rising consumer prices via monetary policy means. Which one of the following is correct in respect of the above statements?
Choose your answer(a)Both Statement–I and Statement–II are correct and Statement–II is the correct explanation for Statement–I(b)Both Statement–I and Statement–II are correct and Statement–II is not the correct explanation for Statement–I(c)Statement–I is correct but Statement–II is incorrect(d)Statement–I is incorrect but Statement–II is correct
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2023 · Question 24 · Monetary Policy
Which one of the following activities of the Reserve Bank of India is considered to be part of ‘sterilization’?
Choose your answer(a)Conducting ‘Open Market Operations’(b)Oversight of settlement and payment systems(c)Debt and cash management for the Central and State Governments(d)Regulating the functions of Non-banking Financial Institutions
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2022 · Question 3 · Monetary Policy
With reference to the Indian economy, consider the following statements : 1. If the inflation is too high, Reserve Bank of India (RBI) is likely to buy government securities. 2. If the rupee is rapidly depreciating, RBI is likely to sell dollars in the market. 3. If interest rates in the USA or European Union were to fall, that is likely to induce RBI to buy dollars. Which of the statements given above are correct ?
Choose your answer(a)1 and 2 only(b)2 and 3 only(c)1 and 3 only(d)1, 2 and 3
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2022 · Question 68 · Monetary Policy
In India, which one of the following is responsible for maintaining price stability by controlling inflation ?
Choose your answer(a)Department of Consumer Affairs(b)Expenditure Management Commission(c)Financial Stability and Development Council(d)Reserve Bank of India
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2021 · Question 11 · Monetary Policy
The money multiplier in an economy increases with which one of the following?
Choose your answer(a)Increase in the Cash Reserve Ratio in the banks(b)Increase in the Statutory Liquidity Ratio in the banks(c)Increase in the banking habit of the people(d)Increase in the population of the country
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2020 · Question 50 · Monetary Policy
If you withdraw ₹ 1,00,000 in cash from your Demand Deposit Account at your bank, the immediate effect on aggregate money supply in the economy will be
Choose your answer(a)to reduce it by ₹ 1,00,000(b)to increase it by ₹ 1,00,000(c)to increase it by more than ₹ 1,00,000(d)to leave it unchanged
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2020 · Question 57 · Monetary Policy
If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do ? 1. Cut and optimize the Statutory Liquidity Ratio 2. Increase the Marginal Standing Facility Rate 3. Cut the Bank Rate and Repo Rate Select the correct answer using the code given below :
Choose your answer(a)1 and 2 only(b)2 only(c)1 and 3 only(d)1, 2 and 3
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2019 · Question 90 · Monetary Policy
The money multiplier in an economy increases with which one of the following?
Choose your answer(a)Increase in the cash reserve ratio(b)Increase in the banking habit of the population(c)Increase in the statutory liquidity ratio(d)Increase in the population of the country
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2017 · Question 11 · Monetary Policy
Which of the following statements is/are correct regarding the Monetary Policy Committee (MPC) ? 1. It decides the RBI’s benchmark interest rates. 2. It is a 12-member body including the Governor of RBI and is reconstituted every year. 3. It functions under the chairmanship of the Union Finance Minister. Select the correct answer using the code given below :
Choose your answer(a)1 only(b)1 and 2 only(c)3 only(d)2 and 3 only
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)
2016 · Question 43 · Monetary Policy
What is/are the purpose/purposes of the ‘Marginal Cost of Funds based Lending Rate (MCLR)’ announced by RBI? 1. These guidelines help improve the transparency in the methodology followed by banks for determining the interest rates on advances. 2. These guidelines help ensure availability of bank credit at interest rates which are fair to the borrowers as well as the banks. Select the correct answer using the code given below.
Choose your answer(a)1 only(b)2 only(c)Both 1 and 2(d)Neither 1 nor 2
Source: UPSC, Civil Services (Preliminary), General Studies Paper I (opens in a new tab)

Which one of the following activities of the Reserve Bank of India is considered to be part of ‘sterilization’?

In India, which one of the following is responsible for maintaining price stability by controlling inflation ?

The money multiplier in an economy increases with which one of the following?

If you withdraw ₹ 1,00,000 in cash from your Demand Deposit Account at your bank, the immediate effect on aggregate money supply in the economy will be

If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do ? 1. Cut and optimize the Statutory Liquidity Ratio 2. Increase the Marginal Standing Facility Rate 3. Cut the Bank Rate and Repo Rate Select the correct answer using the code given below :

The money multiplier in an economy increases with which one of the following?