Tag: economics

Questions Related to economics

Which of the following is not an instrument of monetary policy?

instruments of monetary policy and the reserve bank of india money and banking economics

  1. SLR

  2. Bank rate policy

  3. Reserve ratio requirements

  4. Government spending

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Correct Option: D

Which of the following statements is correct?

instruments of monetary policy and the reserve bank of india money and banking economics

  1. The RBI is just like any ordinary commercial bank in India.

  2. The RBI is responsible for the overall monetary policy in India.

  3. Selective credit control measures affect all banks in a similar manner.

  4. A high rate of interest encourages new investment.

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Correct Option: B
Explanation:

This statement is correct that the RBI is responsible for the overall monetary policy in India. Others are wrong because the RBI is not just like any ordinary commercial bank in India, selective credit control measures affect all banks in a selective manner and A high rate of interest discourages new investment.

Raising or lowering of the central bank credit rate is known as __________.

instruments of monetary policy and the reserve bank of india money and banking economics

  1. open market operation

  2. cash reserve ratio

  3. bank rate policy

  4. none of the above

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Correct Option: C

Policy measures by the RBI to control and regulate money supply is called __________.

instruments of monetary policy and the reserve bank of india money and banking economics

  1. monetary policy

  2. credit policy

  3. debit policy

  4. loan policy

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Correct Option: A
Explanation:

 Monetary policy refers to various central bank policies which includes both qualitative as well as quantitative measures that regulates various factors that influence domestic currency directly or indirectly like money supply, interest rates and credit availability in the economy. These measures control the rate of money supply in case inflation or deflation. 

Buying and selling of eligible securities in the bill market by the RBI is called __________.

instruments of monetary policy and the reserve bank of india money and banking economics

  1. CRR

  2. SLR

  3. OMO

  4. Bank Rate

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Correct Option: C
Explanation:

Open market operation (OMO) is a monetary policy by the central bank in which the bank deals in the sale and purchase of securities in the open market to control the supply of money in the economy. By selling the securities, the central bank soaks liquidity from the economy and by buying the securities, the central bank releases liquidity. 

Manipulation in CRR enables the RBI to ______.

instruments of monetary policy and the reserve bank of india money and banking economics

  1. Influence the lending ability of the commercial banks

  2. Check unemployment growth

  3. Check poverty

  4. Increase GDP

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Correct Option: A
Explanation:

Cash Reserves Ratio (CRR) refers to the proportion of total deposits of the commercial banks which they must keep as reserves with the central bank in the form of cash. If the cash reserve ratio is high, then the bank will have to maintain more amount of cash with the central bank which will reduce their lending capacity and if the cash reserve ratio is low, then the bank will have to maintain less amount of cash with the central bank which will increase their lending capacity. Therefore, Manipulation in cash reserve ratio enables the Reserve Bank of India(RBI) to affect the lending capacity of the commercial banks. 

Environmental degradation is not an economic problem.

economics environment and sustainable development need for sustainable development environmental economics sustainable development

  1. True

  2. False

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Correct Option: B

Process of ____________ has been accompanied with depletion in the stock of natural resources and environmental degradation.

economics environment and sustainable development need for sustainable development environmental economics sustainable development

  1. inclusive growth

  2. economic growth

  3. sustainable development

  4. none of the above

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Correct Option: B
Explanation:

Economic growth refers to the process of using natural resources for the development of the economy. But in developed countries the resources are exploited in a very large quantity that leads to the depletion of these stock of natural resources.

Which of the following are greenhouse gases?

economics environment and sustainable development need for sustainable development environmental economics sustainable development

  1. carbon dioxide

  2. methane

  3. nitrous oxide

  4. All of these

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Correct Option: D
Explanation:

All of the above. 

Greenhouse gases are gases in Earth's air that trap heat. They let daylight go through the climate, yet they forestall the warmth that the daylight brings from leaving the environment.

Which of the following is not the reason for the shift in supply and demand of energy away from its economic equilibrium?

economics environment and sustainable development need for sustainable development environmental economics sustainable development

  1. Tax hikes

  2. Nationalisation of energy companies

  3. Regulation of the energy sector

  4. None of the above

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Correct Option: D