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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
During deflation, the Central Bank usually ______.
Which of the following is not a quantitative method of credit control?
What is meant by open market operations?
State the impact of an increase in Cash Reserve Ratio on loanable funds.
Briefly explain the following credit control method adopted by the Central Bank.
Publicity
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?
Identify the following Credit Control measures undertaken by the Central Bank during inflation.
The Central Bank increases the rate at which it lends to the Commercial Bank.
What are quantitative methods of credit control?
Which are qualitative methods of credit control?
