English

Give an example of margin requirements. - Economic Applications

Advertisements
Advertisements

Question

Give an example of margin requirements.

Answer in Brief
Advertisements

Solution

Example of margin requirements:

Suppose the central bank fixes a margin of 30%, then the bank is allowed to give a loan only up to 70% of the value of the security.

shaalaa.com
Monetary Policy of the Central Bank
  Is there an error in this question or solution?
Chapter 9: Central Banks - QUESTION BANK [Page 217]

APPEARS IN

Goyal Brothers Prakashan Economic Applications [English] Class 10 ICSE
Chapter 9 Central Banks
QUESTION BANK | Q 14. ii | Page 217
Goyal Brothers Prakashan Economics [English] Class 10 ICSE
Chapter 8 Central Bank
QUESTION BANK | Q 11. (ii) | Page 159

RELATED QUESTIONS

Briefly explain two qualitative methods of credit control adopted by this institution.


The rate of which commercial banks borrow from the Central Bank is the:


______ is a quantitative method of credit control.


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): Bank rate is a quantitative instrument of monetary policy.

Reason (R): During inflation, RBI reduces the bank rate.


Define the term Statutory Liquidity Ratio.


Differentiate between quantitative and qualitative methods of credit control.


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


Briefly explain the following credit control methods adopted by the Central Bank.

Moral persuasion 


The Central Bank is the apex monetary institution of the country. Explain its role of a custodian of foreign exchange reserves.


Which of the following statements are correct and which are incorrect? Give reasons.

  1. Central bank is a currency authority.
  2. Bank rate is a qualitative method of credit control.
  3. Quantitative methods regulate direction of credit.
  4. Bank rate is the rate at which commercial banks give loans to the public.
  5. Central bank should sell government securities when credit is to be expanded.

Who controls the credit supply in an economy?


Identify the following Credit Control measure undertaken by the Central Bank during inflation.

The Central Bank sells government approved securities to the public.


Define moral persuasion.


Share
Notifications

Englishहिंदीमराठी


      Forgot password?
Use app×