Advertisements
Advertisements
प्रश्न
The process of buying and selling of securities by the central bank of a country is known as ______.
पर्याय
Margin Requirement
Open Market Operations
Cash Reserve Ratio
Statutory Liquidity Ratio
Advertisements
उत्तर
The process of buying and selling of securities by the central bank of a country is known as Open Market Operations.
Explanation:
Open Market Operations (OMO) is when the central bank buys and sells government assets in the open market to control the economy's money supply. When the central bank buys assets, it adds money to the banking system, improving liquidity. When it sells securities, it removes funds from the system, lowering liquidity.
संबंधित प्रश्न
Define bank rate.
Which of the following is a selective/qualitative method of credit control.
The rate of which commercial banks borrow from the Central Bank is the:
The difference between the value of security and the amount of loan sanctioned against these securities is known as:
______ is a quantitative method of credit control.
Which of the following is not a quantitative method of credit control?
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 |
During inflation, the central bank usually:
Give any two reasons as to why a country needs a central bank.
Define the term Statutory Liquidity Ratio.
State the impact of an increase in Cash Reserve Ratio on loanable funds.
Define the following term:
Margin Requirements.
Briefly explain the following credit control method adopted by the Central Bank.
Publicity
Central bank is the lender of the last resort. Explain.
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.
