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    Question

    Consider the following statements about Foreign Exchange

    Reserves: 1. These may include foreign currencies, bonds, treasury bills, and other government securities. 2. Reserves are denominated and expressed in the US dollar. 3. SBI is the custodian of the Foreign exchange reserves in India. Which of the above statement is/are not correct?
    A 1 only Correct Answer Incorrect Answer
    B 2 only Correct Answer Incorrect Answer
    C 3 only Correct Answer Incorrect Answer
    D 1 and 2 only Correct Answer Incorrect Answer
    E 1, 2 and 3 only Correct Answer Incorrect Answer

    Solution

    These may include foreign currencies, bonds, treasury bills, and other government securities. Reserves are denominated and expressed in the US dollar, which is the international numeraire for the purpose. RBI is the custodian of the Foreign exchange reserves in India.

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