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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
Briefly explain two qualitative methods of credit control adopted by this institution.
Which of the following is a selective/qualitative method of credit control?
Define qualitative credit control policy of the RBI.
Explain how credit rationing helps to control credit in an economy.
The central bank controls credit _____ .
Which of the following is not a quantitative method of credit control?
In order to encourage investment in the economy, the central bank may ______.
The process of buying and selling of securities by the central bank of a country is known as ______.
Match the following and select the correct option:
| Column A | Column B | ||
| (i) | A rate of interest at which the central bank (RBI) lends money to member commercial banks to meet they long term needs. | A. | Cash Reserve Ratio |
| (ii) | A rate of interest at which RBI lends money to commercial banks to meet their short term needs. | B. | Statutory liquidity ratio |
| (iii) | A minimum percentage of total deposits kept by banks with the Central Bank. | C. | Repo rate |
| (iv) | A minimum percentage of total deposits to be kept by banks inform of liquid assets with themselves. | D. | Bank rate |
Observe the relationship of the first pair of words and complete the second pair.
Quantitative method of credit control by the central bank : Bank rate.
Quantitative method of credit control by the central bank :
During inflation, the central bank usually:
Define the following term:
Cash Reserve Ratio.
Define the following term:
Margin Requirements.
Briefly explain the following credit control method adopted by the Central Bank.
Publicity
Who controls the credit supply in an economy?
What do you mean by credit control?
Which are qualitative methods of credit control?
Define moral persuasion.
Describe two quantitative credit control measures of the Central Bank.
