Balance Of Payment

1

What are the determinants of short-term interest rates?

  1. Monetary policy instruments
  2. Differing policy objectives
  3. Public Sector Borrowing
  4. Globalisation and the exchange rate

Select the correct code:

A
1 and 2
B
1, 2 and 4
C
1, 2 and 3
D
All of the above
2

What do you understand by Twin Balance Sheet Challenge?

  1. The impaired financial positions of the Public Sector Banks (PSBs)
  2. Impeding private investment
  3. Over leveraged corporate houses
  4. High ratio of shareholder equity to assets for RBI

Code:

A
1 and 2
B
1 and 3
C
2, 3 and 4
D
All of the above
3

India’s foreign exc hange reserves comprises of

  1. Foreign currency assets
  2. Gold
  3. Special drawing rights
  4. FDI

Select the correct code:

A
1 and 4 only
B
1, 2 and 3 only
C
2, 3 and 4 only
D
4 only
4

Insolvency & Bankruptcy Board of India (IBBI) is in news. Consider the following statements with respect to IBBI:

  1. It is a Statutory Body under the Ministry of Finance.
  2. It acts as a regulator for insolvency professionals, information utilities, etc.
  3. It consists of 10 members - from RBI, Central Government and people nominated by the Central Government.

Choose the correct statement from the code given below:

A
1 and 2 only
B
2 and 3 only
C
1, 2 and 3
D
1 and 3 only
5

A country is said to be in a debt trap if:

A
It has to abide by the conditionality imposed by the international Monetary Fund.
B
It has to borrow to make interest payments on outstanding loans.
C
It has been refused loans or aid by creditors abroad
D
The World Bank charges a very high rate of interest on outstanding as well as new loans.
6

Consider the following statements:

  1. The full convertibility of Indian Rupee refers to the capital account convertibility of Indian Rupee.
  2. full convertibility of Indian Rupee means that foreign exchange rate be determined through the market forces of demand and supply.
  3. It will help to promote exports.

Which of the above statements are correct?

A
I and II
B
Only I
C
II
D
All
7

Consider the following statements:

  1. India’s foreign exchange reserves comprise of foreign currency assets (FCA), gold, special drawing rights (SDRs) and reserve tranche position (RTP) in the International Monetary Fund (IMF).
  2. Foreign currency assets are maintained in major currencies like the US dollar, euro, pound sterling, Canadian dollar, Australian dollar and Japanese yen, etc.
  3. The nominal effective exchange rate (NEER) and real effective exchange rate (REER) indices are used as indicators of external Competitiveness of the country.

Select the correct statements from the codes given below:

A
I and II
B
II and III
C
I and III
D
All
8

What are the prerequisites for full rupee convertibility?

  1. Fiscal consolidation
  2. Strengthening the banking sector
  3. A mandated inflation target
A
1, 2 and 3
B
1 only
C
1 and 2 only
D
None of the above

Indian Economy