Question
Consider the following statements regarding instruments
of Monetary Policy: I. The Repo rate is the interest rate at which the Reserve Bank provides overnight liquidity to banks. II. The Bank rate is the rate at which the RBI is ready to buy or rediscount bills of exchange or other commercial papers. III. The Cash Reserve Ratio is the average daily balance that a bank is required to maintain with the RBI as a share of such percent of its Net Demand and Time Liabilities (NDTL). Which of the statements given above is/are correct?Solution
Statement I is correct- The Repo rate is the interest rate at which the Reserve Bank provides overnight liquidity to banks against the collateral of government and other approved securities under the liquidity adjustment facility (LAF), Statement II is correct - Bank rate is the rate at which the RBI is ready to buy or rediscount bills of exchange or other commercial papers. The Bank Rate is published under Section 49 of the RBI Act, 1934. Statement III is correct - Cahs reserve ratio is the average daily balance that a bank is required to maintain with the Reserve Bank as a share of such per cent of its Net demand and time liabilities (NDTL) that the Reserve Bank may notify from time to time in the Gazette of India.
In a period of rising prices and stable inventory quantities, which of the following best describes the effect on gross profit of using LIFO as compared...
Under the Indian Trusts Act, 1882, what happens when a trustee mingles trust property with their personal property ? Â
What does Organizational Behavior (OB) Â study and apply knowledge about?
What are the needs listed in Maslow's pyramid from bottom to top?
According to the IRAC Norms, a loan where the borrower has defaulted on payment for over 12 months is classified as _________
 ABC Ltd is a financing company and has given loans and advances to its subsidiary and earned an interest of Rs 1.00 lacs. This interest income is :
Calculate the closing inventory from the following information:
·        Purchases Rs.90,000
·        Sales Rs.125,0...
TRP Ltd. recorded operating profit of Rs.100,000, tax of Rs.17000, interest of Rs.34,000 and dividends of Rs.5000. What is the company’s net profit a...
What does the principle of sustainability in business ethics emphasize?
With the objective to better align the guidelines of RBI with the BCBS (BASEL Committee on Banking Supervision) standard and enable banks to manage liqu...
Relevant for Exams:
