What is/are the benefits of the Cheque Truncation System (CTS) introduced by the Reserve Bank of India?

1. A physical cheque is not required to be issued by the account holder for payment purposes leading to improved logistical management.

2. The system reduces the scope of loss of cheque instruments in transit from bank to bank resulting in better service to customers.

Which of the above is/are correct?

Monetary transmission refers to the process by which a central bank’s monetary policy decisions are passed on to the financial markets. Monetary transmission remains weak in India due to

1. High volume of government borrowing through the SLR route

2. High level of NPAs of banks

3. A number of Interest rate subvention schemes

Select the correct answer using the codes below.

Real interest rate will NOT be lower than the nominal interest rate in which of the following cases?

What is the role of monetary policy in the economy?

1) During a situation of low demand, it can revive demand by increasing liquidity.

2) It affects government borrowing significantly thereby affecting public spending.

Which of the above is/are correct?

In India, monetary policy is designed with an objective to

1) Control inflation

2) Increase foreign exchange reserves

3) Reduce the fiscal deficit

4) Generate surplus factors of production

Select the correct answer using the codes below.