6D) Functions of RBI – Money Supply, Monetary Policy, Forex Mgt & Balance of Payment (Prelims PYQs)

2023 Prelims PYQs

1] Which of the following activities of Reserve Bank of India is considered to be part of ‘Sterilization’? [2023]

a) Conducting ‘Open Market Operations’
b) Oversight of settlement and payment systems
c) Debt and cash management for Central and State Governments
d) Regulating the functions of Non-banking Financial Institutions

Show Answer

Ans: a) Conducting ‘Open Market Operations’

2022 Prelims PYQs

1] In India, which one of the following is responsible for maintaining price stability by controlling inflation? [2022]

a) Department of Consumer Affairs
b) Expenditure Management Commission
c) Financial Stability and Development Council
d) Reserve Bank of India

Show Answer

Ans: d) Reserve Bank of India

2] Consider the following statements: [2022]

1. Tight monetary policy of US Federal Reserve could lead to capital fight
2. Capital flight may increase the inter cost of firms with existing External Commercial Borrowings (ECBs).
3. Devaluation of domestic currency decreases the currency risk associated with ECBs
Which of the statements is correct?

a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2 and 3

Show Answer

Ans: a) 1 and 2 only

3] With reference to the Indian economy, consider the following statements: [2022]

1. An increase in Nominal Effective Exchange Rate (NEER) indicates the appreciation of rupee.
2. An increase in the Real Effective Exchange Rate (REER) indicates an improvement in trade competitiveness.
3. An increasing trend in domestic inflation relative to inflation in other countries is likely to cause an increasing divergence between NEER and REER.
Which of the above statements are correct?

a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2 and 3

Show Answer

Ans: c) 1 and 3 only

4] With reference to the Indian economy, consider the following statements: [2022]

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?

a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2 and 3

Show Answer

Ans: b) 2 and 3 only

2021 Prelims PYQs

1] Consider the following statements: [2021]

The effect of devaluation of a currency is that it necessarily
1) Improves the competitiveness of the domestic exports in the foreign markets
2) Increases the foreign value of domestic currency
3) Improves the trade balance
Which of the above statement is/are correct?

a) 1 only
b) 1 and 2
c) 3 only
d) 2 and 3

Show Answer

Ans: a) 1 only

2] Which one of the following is likely to be the most inflationary in its effects? [2021]

a) Repayment of public debt
b) Borrowing from the public to finance a budget deficit
c) Borrowing from the banks to finance a budget deficit
d) Creation of new money to finance a budget deficit

Show Answer

Ans: d) Creation of new money to finance a budget deficit

3] The money multiplier in an economy increases with which one of the following? [2021]

a) Increase in the cash Reserve Ration 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

Show Answer

Ans: c) Increase in the banking habit of the people

4] With reference to Indian economy, demand-pull inflation can be caused/increased by which of the following? [2021]

1) Expansionary policies
2) Fiscal stimulus
3) Inflation-indexing wages
4) Higher purchasing power
5) Rising interest rates
Select the correct answer using the code given below.

a) 1, 2 and 4 only
b) 3, 4 and 5 only
c) 1, 2, 3 and 5 only
d) 1, 2, 3, 4 and 5

Show Answer

Ans: a) 1, 2 and 4 only

2020 Prelims PYQs

1] If another global financial crisis happens in the near future, which of the following actions/policies are most likely to give some immunity to India? [2020]

1. Not depending on short-term foreign borrowings
2. Opening up to more foreign banks
3. Maintaining full capital account convertibility
Select the correct answer using the code given below:

a) 1 only
b) 1 and 2 only
c) 3 only
d) 1, 2 and 3

Show Answer

Ans: a) 1 only

2] 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: [2020]

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

Show Answer

Ans: d) To leave it unchanged

3] Consider the following statements: [2020]

1. The weightage of food in Consumer Price Index (CPI) is higher than that in Wholesale Price Index (WPI).
2. The WPI does not capture changes in the prices of services, which CPI does.
3. Reserve Bank of India has now adopted WPI as its key measure of inflation and to decide on changing the key policy rates.
Which of the statements given above is/are correct?

a) 1 and 2 only
b) 2 only
c) 3 only
d) 1, 2 and 3

Show Answer

Ans: a) 1 and 2 only

4] If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do? [2020]

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:

a) 1 and 2 only
b) 2 only
c) 1 and 3 only
d) 1, 2 and 3

Show Answer

Ans: b) 2 only

2019 Prelims PYQs

1] In the context of India, which of the following factors is/are contributor/contributors to reducing the risk of a currency crisis? [2019]

1. The foreign currency earnings of India’s IT sector
2. Increasing the government expenditure
3. Remittances from Indians abroad
Select the correct answer using the code given below:

a) 1 only
b) 1 and 3 only
c) 2 only
d) 1, 2 and 3

Show Answer

Ans: b) 1 and 3 only

2] Which one of the following is not the most likely measure the Government/RBI takes to stop the slide of Indian rupee? [2019]

a) Curbing imports of non-essential goods and promoting exports
b) Encouraging Indian borrowers to issue rupee denominated Masala Bonds
c) Easing conditions relating to external commercial borrowing
d) Following an expansionary monetary policy

Show Answer

Ans: d) Following an expansionary monetary policy

3] The money multiplier in an economy increases with which one of the following? [2019]

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

Show Answer

Ans: b) Increase in the banking habit of the population

2017 Prelims PYQs

1] Which of the following statements is/are correct regarding the Monetary Policy Committee (MPC)? [2017]

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:

a) 1 only
b) 1 and 2 only
c) 3 only
d) 2 and 3 only

Show Answer

Ans: a) 1 only

2016 Prelims PYQs

1] Which of the following best describes the term ‘import cover’, sometimes seen in the news? [2016]

a) It is the ratio of value of imports to the Gross Domestic Product of a country
b) It is the total value of imports of a country in a year
c) It is the ratio between the value of exports and that of imports between two countries
d) It is the number of months of imports that could be paid for by a country’s international reserves

Show Answer

Ans: d) It is the number of months of imports that could be paid for by a country’s international reserves

2015 Prelims PYQs

1] With reference to India economy, consider the following: [2015]

1. Bank rate
2. Open market operations
3. Public debt
4. Public revenue
Which of the above is/are component/components of Monetary Policy?

a) 1 only
b) 2, 3 and 4
c) 1 and 2
d) 1, 3 and 4

Show Answer

Ans: c) 1 and 2

2] Which reference to inflation in India, which of the following statements is correct? [2015]

a) Controlling the inflation in India is the responsibility of the Government of India only
b) The Reserve Bank of India has no role in controlling the inflation
c) Decreased money circulation helps in controlling the inflation
d) Increased money circulation helps in controlling the inflation

Show Answer

Ans: c) Decreased money circulation helps in controlling the inflation

3] When the Reserve Bank of India reduces the Statutory Liquidity by 50 basis points, which of the following is likely to happen? [2015]

a) India’s GDP growth rate increases drastically
b) Foreign Institutional Investors may bring more capital into our country
c) Scheduled Commercial Banks may cut their lending rates
d) It may drastically reduce the liquidity to the banking system.

Show Answer

Ans: c) Scheduled Commercial Banks may cut their lending rates

4] Which of the following brings out the ‘Consumer Price Index Number for the Industrial Workers’? [2015]

a) The Reserve Bank of India
b) The Department of Economic Affairs
c) The Labour Bureau
d) The department of Personnel and Training

Show Answer

Ans: c) The Labour Bureau

5] Convertibility of rupee implies: [2015]

a) Being able to convert rupee notes into gold
b) Allowing the value of rupee to be fixed by market forces
c) Freely permitting the conversion of rupee to other currencies and vice versa
d) Developing an international market for currencies in India

Show Answer

Ans: c) Freely permitting the conversion of rupee to other currencies and vice versa

2014 Prelims PYQs

1] With reference to Balance of Payments, which of the following constitutes/constitute the Current Account? [2014]

1. Balance of trade
2. Foreign assets
3. Balance of invisibles
4. Special Drawing Rights
Select the correct answer using the code given below.

a) 1 only
b) 2 and 3
c) 1 and 3
d) 1, 2 and 4

Show Answer

Ans: c) 1 and 3

2] In the context of Indian economy which of the following is/are the purpose/purposes of ‘Statutory Reserve Requirements’? [2014]

1. To enable the Central Bank to control the amount of advances the banks can create.
2. To make the people’s deposits with banks safe and liquid.
3. To prevent the commercial banks from making excessive profits. 4. To force the banks to have sufficient vault cash to meet their day-to-day requirements.
Select the correct answer using the code given below.

a) 1 only
b) 1 and 2 only
c) 2 and 3 only
d) 1, 2, 3 and 4

Show Answer

Ans: a) 1 only

3] If the interest rate is decreased in an economy, it will: [2014]

a) Decrease the consumption expenditure in the economy
b) Increase the tax collection of the Government.
c) Increase the investment expenditure in the economy
d) Increase the total savings in the economy.

Show Answer

Ans: c) Increase the investment expenditure in the economy

2013 Prelims PYQs

1] A rise in general level of prices may be caused by___: [2013]

1. An increase in the money supply
2. A decrease in the aggregate level of output
3. An increase in the effective demand
Select the correct answer using the codes given below:

a) 1 only
b) 1 and 2 only
c) 2 and 3 only
d) 1, 2 and 3

Show Answer

Ans: d) 1, 2 and 3

2] Which one of the following groups of items is included in India’s Foreign Exchange Reserves? [2013]

a) Foreign-currency assets, Special Drawing Rights (SDRs) and loans from foreign countries
b) Foreign-currency assets, gold holdings of the RBI and SDRs
c) Foreign currency assets, loans from the World Bank and SDRs
d) Foreign currency assets, gold holdings ‘of the RBI and loans from the World Bank

Show Answer

Ans: b) Foreign-currency assets, gold holdings of the RBI and SDRs

3] Which one of the following is likely to be the most inflationary in its effect? [2013]

a) Repayment of public debt
b) Borrowing from the public to finance a budget deficit
c) Borrowing from banks to finance a budget deficit
d) Creating new money to finance a budget deficit

Show Answer

Ans: d) Creating new money to finance a budget deficit

4] Supply of money remaining the same when there is an increase in demand for money, there will be __: [2013]

a) A fall in the level of prices
b) An increase in the rate of interest
c) A decrease in the rate of interest
d) An increase in the level of income and employment

Show Answer

Ans: b) An increase in the rate of interest

5] Consider the following statement: [2013]

1. Inflation benefits the debtors.
2. Inflation benefits the bond-holders.
Which of the statements given above is/are correct?

a) 1 only
b) 2 only
c) both 1 and 2
d) Neither 1 nor 2

Show Answer

Ans: a) 1 only

6] Consider the following liquid assets: [2013]

1. Demand deposits with the banks
2. Time deposits with the banks
3. Savings deposits with the banks
4. Currency
The correct sequence of these assets in decreasing order of liquidity is:

a) 1-4-3-2
b) 4-3-2-1
c) 2-3-1-4
d) 4-1-3-2

Show Answer

Ans: d) 4-1-3-2

7] In the context of Indian economy, ‘open market operations’ refers to? [2013]

a) Borrowing by scheduled banks from the RBI
b) Lending by commercial banks to industry and trade
c) Purchase and sale of government securities by the RBI
d) None of the above

Show Answer

Ans: c) Purchase and sale of government securities by the RBI

8] The balance of payments of a country is a systematic record of? [2013]

a) All import and export transactions of a country during a given period of time, normally a year
b) Goods exported from a country during a year
c) Economic transaction between the governments of one country to another
d) Capital movements from one country to another

Show Answer

Ans: a) All import and export transactions of a country during a given period of time, normally a year

9] An increase in the bank rate generally indicates that the? [2013]

a) Market rate of interest is likely to fall
b) Central bank is no longer making loans to commercial banks
c) Central bank is following an easy money policy
d) Central bank is following a tight money policy

Show Answer

Ans: d) Central bank is following a tight money policy

10] Which of the following constitute capital account? [2013]

1. Foreign loans
2. Foreign direct investment
3. Private remittances
4. Portfolio investment
Select the correct answer using the codes given below.

a) 1, 2 and 3
b) 1, 2 and 4
c) 2, 3 and 4
d) 1, 3 and 4

Show Answer

Ans: b) 1, 2 and 4

2012 Prelims PYQs

1] Which of the following measures would result in an increase in the money supply in the economy? [2012]

1. Purchase of government securities from the public by the Central Bank
2. Deposit of currency in the commercial banks by the public
3. Borrowing by the government from the Central Bank
4. Sale of government securities to the public by the Central Bank

Select the correct answer using the codes given below:
a) 1 Only                             b) 2 & 4 Only
c) 1 & 3                                d) 2, 3 & 4

Show Answer

Ans: c) 1 & 3

2011 Prelims PYQs

1] India has experienced persistent and high food inflation in the recent past. What could be the reasons? [2011]

1.Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.
2.As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change.
3.The food supply chain has structural constraints.

Which of the statements given above are correct?
a) 1 and 2 only                  b) 2 and 3 only
c) 1 and 3 only                  d) 1,2, and 3

Show Answer

Ans:   b) 2 and 3 only

2] In terms of economy, the visit by foreign nationals to witness the XIX common wealth games in India amounted to? [2011]

a) Export                            b) Import
c) Production                    d) Consumption

Show Answer

Ans: a) Export

3] Consider the following actions which the government can take: [2011]

1. Devaluing the domestic currency.
2. Reduction in the export subsidy.
3. Adopting suitable policies which attract greater FDI and more funds from FIIs.

Which of the above action/actions can help in reducing the current account deficit?
a) 1 and 2                           b) 2 and
c) 3 only                             d) 1 and 3

Show Answer

Ans: d) 1 and 3

4] A rapid increase in the rate of inflation is sometimes attributed to the ‘base effect’. What is ‘base effect’? [2011]

a) It is the impact of drastic deficiency in supply due to failure of crops.
b) It is the impact of the surge in demand due to rapid economic growth.
c) It is the impact of the price levels of previous year on the calculation of inflation rate.
d) None of the statements (a), (b) and (c) given above is correct in this context.

Show Answer

Ans: c) It is the impact of the price levels of previous year on the calculation of inflation rate.

5] The lowering of bank rate by the reserve bank of India leads to? [2011]

a) More liquidity in the market.
b) Less liquidity in the market.
c) No change in the liquidity  in the market.
d) Mobilization of more deposits by commercial banks.

Show Answer

Ans: a) More liquidity in the market.

2010-1995 Prelims PYQs

1] When the Reserve Bank of India announces an increase of the Cash Reserve Ratio, what does it mean? [2010]

a) The commercial banks will have less money to lend.
b) The Reserve Bank of India will have less money to lend.
c) The Union Government will have less money to lend.
d) The commercial banks will have more money to lend.

Show Answer

Ans: a) The commercial banks will have less money to lend.

2] With reference to India, consider the following statements: [2010]

1. The Wholesale Price Index (WPI) in India is available on a monthly basis only.
2. As compared to Consumer Price Index for Industrial Workers (CPI(IW)), the WPI gives less weight to food articles.

Which of the statements given above is/are correct?
a) 1 only                            b) 2 only
c) Both 1 and 2                 d) Neither 1 nor 2

Show Answer

Ans: c) Both 1 and 2   

3] Tarapore  Committee was associated with which one of the following? [2007]

a) Special Economic Zones
b) Fuller capital account convertibility
c) Foreign exchange reserves
d) Effect of oil-prices on the Indian economy

Show Answer

Ans: b) Fuller capital account convertibility

4] Consider the following statements: [2007]

1.  The repo rate is the rate at which other banks borrow from the Reserve Bank of India.
2. A value of 1 or Gini Coefficient in a country inplies that there is perfectly equal income for everyone in its population.

Which of the statements given above is/are correct?
a) 1 only                            b) 2 only
c) Both 1 and 2                 d) Neither 1 nor 2

Show Answer

Ans: c) Both 1 and 2  .

5] Assertion (A): Balance of Payments. represents a better picture of a country’s economic transactions with the rest of the world than the Balance of Trade

Reason (R): Balance of Payments takes into account the exchange of both visible and invisible items whereas Balance of Trade. does not.

a) Both A and R are individually true and R is the correct explanation of A.
b) Both A and R are individually tru but R is not the correct explanation of A.
c) A is True but R is false
d) A is false but R is true

Show Answer

Ans: a) Both A and R are individually true and R is the correct explanation of A.

6] Consider the following statements: [2005]

1. During the year 2004, India’s foreign exchange reserves did not exceed the 125 billion U.S. dollar mark.
2. The Series of index numbers of wholesale prices introduced from April, 2000 has the year 1993-94 as base year.

Which of the statements is/are correct?
a) 1 only                            b) 2 only
c) Both 1 and 2                 d) Neither 1 nor 2

Show Answer

Ans: b) 2 only

7] Which one of the following statements is correct with reference to FEMA in India? [2003]

a) The Foreign Exchange Regulation Act (FERA), was replaced by Foreign Exchange Management Act (FEMA) in the year 2001
b) FERA was given a sunset clause of one year till 31st May 2002 to enable Enforcement Directorate to complete the investigation of pending issues
c) Under FEMA, violation of foreign exchange rules has ceased to be a criminal offence
d) As per the new dispensation, Enforcement Directorate can arrest and prosecute the people for the violation of foreign exchange rules

Show Answer

Ans: c) Under FEMA, violation of foreign exchange rules has ceased to be a criminal offence

8] Which reference to the Wholesale Price Index (WPI), consider the following statements: [2002]

1. The new WPI series with base 1993-94 = 100 became effective from April 1998
2. In the new WPI series, became effective from 1 April 2000.
3. The weight for electricity has increased in the new WPI series

Which of these statements are correct?
a) 1, 2 and 3        b) 2 and 3
c) 1 and 3            d) 1 and 2

Show Answer

Ans: b) 2 and 3

9] Consider the following: [2002]

1. Currency with the public
2. Demand deposits with banks
3. Time deposits with banks

Which of these are included in Broad Money (M3) in India?
a) 1 and 2                           b) 1 and 3
c) 2 and 3                           d) 1, 2 and 3

Show Answer

Ans: d) 1, 2 and 3

10] Consider the following statements: Full convertibility of the rupee may mean: [2002]

1. Its free float with other international currencies.
2. Its direct exchange with any other international currency at any prescribed place inside and outside the country.
3. It acts just like any other international currency.

Which of these statements are correct?
a) 1 and 2                           b) 1 and 3
c) 2 and 3                           d) 1, 2 and 3

Show Answer

Ans: d) 1, 2 and 3

11] The new series of Wholesale Price Index (WPI) released by the Government of India is with reference to the base prices of: [2001]

a) 1981’82            b) 1990’91
c) 1993’94            d) 1994’95

Show Answer

Ans: c) 1993’94

12] Assertion (A): Ceiling on foreign exchange for a host of current account transaction heads was lowered in the year 2000.: [2001]

Reason (R): There was a fall in foreign currency assets also.
a) Both A and R are individually true, and R is the correct explanation of A
b) Both A and R are individually true, but R is NOT a correct explanation of A
c) A is true, but R is false
d) A is false, but R is true

Show Answer

Ans: a) Both A and R are individually true, and R is the correct explanation of A

13] Consider the following statements: The Indian rupee is fully convertible: [2000]

I. In respect of Current Account of Balance of Payment.
II. In respect of Capital Account of Balance of Payment.
III. Into gold.

Which of these statements is/are correct?
a) I alone                            b) III alone
c) I and II                            d) I, II and III

Show Answer

Ans: a) I alone    

14] Assertion (A): Devaluation of a currency may promote export.: [1999]

Reason (R): Price of the country’s products in the international market may fall due to devaluation.
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 a correct explanation of A
c) A is true, but R is false
d) A is false, but R is true

Show Answer

Ans: a) Both A and R are true, and R is the correct explanation of A

15] The banks are required to maintain a certain ratio between their cash in hand and total assets. This is called: [1998]

a) SBR (Statutory Bank Ratio)
b) SLR (Statutory Liquid Ratio)
c) CBR (Central Bank Reserve)
d) CLR (Central Liquid Reserve)

Show Answer

Ans: b) SLR (Statutory Liquid Ratio)

16] Capital Account Convertibility of the Indian Rupee implies: [1998]

a) That the Indian Rupee can be exchanged by the authorised dealers for travel
b) That the Indian Rupee can be exchanged for any major currency for the purpose of trade in goods and services
c) That the Indian Rupee can be exchanged for any major currency for the purpose of trading financial assets
d) None of the above

Show Answer

Ans: c) That the Indian Rupee can be exchanged for any major currency for the purpose of trading financial assets

17] The average rate of domestic savings (gross) for the Indian economy is currently estimated to be in the range of: [1997]

a) 15 to 20 per cent         b) 20 to 25 per cent
c) 25 to 30 per cent          d) 30 to 35 per cent

Show Answer

Ans: c) 25 to 30 per cent 

18] The sum of which of the following constitutes Broad Money in India? [1997]

I. Currency with the Public
II. Demand deposits with banks
III. Time deposits with banks
IV. Other deposits with RBI

Choose the correct answer using the codes given below:
a) I and II                          b) I, II and III
c) I, II, III and IV                 d) I, II and IV

Show Answer

Ans: b) I, II and III

19] In India, inflation is measured by the: [1997]

a) Wholesale Price Index Number
b) Consumers Price Index for urban non-manual workers
c) Consumers Price Index for agricultural workers
d) National Income deflation

Show Answer

Ans: a) Wholesale Price Index Number

20] One of the important goals of the economic liberalisation policy is to achieve full convertibility of the Indian rupee. This is being advocated because: [1996]

a) Convertibility of the rupee will stabilize its exchange value against major currencies of the world
b) It will attract more foreign capital inflow in India
c) It will help promote exports
d) It will help India secure loans from the world financial markets at attractive terms

Show Answer

Ans: a) Convertibility of the rupee will stabilize its exchange value against major currencies of the world

21] Hawala transactions relate to payments: [1996]

a) Received in rupees against overseas currencies and vice versa without going through the official channels
b) Received for sale/transfer of shares without going through the established stock exchanges
c) Received as commission for services rendered to overseas investors/buyers/ sellers in assisting them to get over the red tape and/or in getting preferential treatment
d) Made to political parties or to individuals for meeting election expenses

Show Answer

Ans: a) Received in rupees against overseas currencies and vice versa without going through the official channels

22] Which of the following pairs are correctly matched? [1995]

I. Increase in foreign exchange reserves – Monetary expansion
II. Low import growth rate in India – Recession in Indian Industry
III. Euro-issues – Shares held by Indian companies in European countries
IV. Portfolio investment – Foreign institutional investors

Select the correct answer by using the following codes:
Codes:
a) I, II and IV                      b) III and IV
c) I, II and III                      d) I, II, III and IV

Show Answer

Ans: a) I, II and IV

23] Bank Rate implies the rate of interest: [1995]

a) Paid by the Reserve Bank of India on the Deposits of Commercial Banks
b) Charged by Banks on loans and advances
c) Payable on Bonds
d) At which the Reserve Bank of India discounts the Bills of Exchange

Show Answer

Ans: d) At which the Reserve Bank of India discounts the Bills of Exchange

24] The Narasimham Committee for Financial Sector Reforms has suggested reduction in: [1995]

a) SLR and CRR
b) SLR, CRR and Priority Sector Financing
c) SLR and Financing to capital goods sector
d) CRR, Priority Sector Financing and Financing to capital goods sector

Show Answer

Ans: b) SLR, CRR and Priority Sector Financing

We’re in the process of posting all the questions from 1995-2023. The tentative date of completion is 16 Dec 2023. We highly recommend purchasing our UPSC Prelims PYQ Book (2024 Edition) to access all questions in a single PDF.