UPSC 2020 › Indian Economy › Monetary Policy & Money Supply

2 questions · 2020 · answers as per the UPSC key

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UPSC 2020 · Q50 · Indian Economy › Monetary Policy & Money Supply · Save

If you withdraw ₹ 1,00,000 in cash from your Demand Deposit Account at your bank, the immediate effect on aggregate money supply in the economy will be

(a) to reduce it by ₹ 1,00,000
(b) to increase it by ₹ 1,00,000
(c) to increase it by more than ₹ 1,00,000
(d) to leave it unchanged
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Answer: (d) to leave it unchanged
UPSC 2020 · Q57 · Indian Economy › Monetary Policy & Money Supply · Save

If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do ?

  1. Cut and optimize the Statutory Liquidity Ratio
  2. Increase the Marginal Standing Facility Rate
  3. Cut the Bank Rate and Repo Rate

Select the correct answer using the code given below :

(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
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Answer: (b) 2 only