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प्रश्न
What is meant by open market operations?
Explain the following concept.
Open Market Operation
Explain the following:
Open Market Operation
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उत्तर
- Open market operations refer to the buying and selling of government securities. These securities can be bought or sold to the public or to the commercial banks in an open market.
- Open market operations are used by the central bank to affect the money supply in the economy.
- The sale of securities by the RBI drains the extra cash from the economy, thereby limiting the money supply, whereas the purchase of securities by the RBI pumps additional money into the economy, thereby stimulating the money supply.
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संबंधित प्रश्न
The central bank controls credit _____ .
Which of the following is not a quantitative method of credit control?
Bank rate is the rate at which:
During inflation, the central bank usually:
Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): Increase in cash reserve ratio adversely affects the capacity of commercial banks to create credit.
Reason (R): An increase in cash reserve ratio reduces the excess reserves of commercial banks and hence limits their credit creating power.
Define the term Statutory Liquidity Ratio.
State the impact of an increase in Cash Reserve Ratio on loanable funds.
Differentiate between quantitative and qualitative methods of credit control.
Define the following term:
Cash Reserve Ratio.
Define the following term:
Margin Requirements.
Central bank is the lender of the last resort. Explain.
Explain the following function of the central bank of a country.
Fixation of margin requirement on secured loans.
Which of the following statements are correct and which are incorrect? Give reasons.
- Central bank is a currency authority.
- Bank rate is a qualitative method of credit control.
- Quantitative methods regulate direction of credit.
- Bank rate is the rate at which commercial banks give loans to the public.
- Central bank should sell government securities when credit is to be expanded.
Identify the following Credit Control measure undertaken by the Central Bank during inflation.
The Central Bank sells government approved securities to the public.
What do you mean by credit control?
Which are qualitative methods of credit control?
What is meant by Legal Reserve Ratio?
Define moral persuasion.
Give an example of margin requirements.
