ECONOMICS
FINANCIAL MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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(a) development financial institution
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(b) commercial bank
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( c ) selected individuals
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( d ) reserve bank of India
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Detailed explanation-1: -Treasury bills are one of the most popular short-term government schemes issued by the RBI and are backed by the central government. Such tools act as a liability to the Indian government as they need to be repaid within the stipulated date.
Detailed explanation-2: -These are securities issued by the state governments. The issues are also managed and serviced by the Reserve Bank of India.
Detailed explanation-3: -In India, the Central Government issues both, treasury bills and bonds or dated securities while the State Governments issue only bonds or dated securities, which are called the State Development Loans (SDLs).
Detailed explanation-4: -Adhoc treasury bills are issued in favour of the RBI only.
Detailed explanation-5: -Treasury Bills are short term (up to one year) borrowing instruments of the Government of India or by a central authority of any country which enable investors to park their short term surplus funds while reducing their market risk.