Question 4 of 57Indian Economy
With reference to the Indian economy, consider the following statements: 1. If the inflation is too high, the Reserve Bank of India (RBI) is likely to buy government securities. 2. If the rupee is rapidly depreciating, RBI is likely to sell dollars in the market. 3. If interest rates in the USA or European Union were to fall, that is likely to induce RBI to buy dollars. Which of the statements given above are correct?
A1 and 2 only
B2 and 3 only
C1 and 3 only
D1, 2 and 3
Correct Answer
The correct answer is hidden
Explanation
31 words hidden ... because selling dollars from reserves can support the rupee when it is rapidly depreciating. - Statement 3 is also ... 26 words hidden