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प्रश्न
During inflation, the central bank usually:
पर्याय
Decreases bank rate
Decreases cash reserve ratio
Increases bank rate
Buys government securities
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उत्तर
Increases bank rate
Explanation:
During inflation, the central bank normally raises the bank rate. This makes borrowing more expensive for commercial banks, resulting in higher interest rates for individuals and companies. The greater cost of borrowing reduces the economy's money supply, which helps to keep inflation under control.
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संबंधित प्रश्न
Define bank rate.
The difference between the value of security and the amount of loan sanctioned against these securities is known as:
During deflation, the Central Bank usually ______.
______ is 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 ______.
Define the following term:
Cash Reserve Ratio.
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.
Who controls the credit supply in an economy?
