ECONOMICS
MONETARY POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Capital investment in research and development
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Interest rate policy
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The money supply
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Bank credit control
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Detailed explanation-1: -The Monetary Policy Committee is not involved in setting the inflation target rate.
Detailed explanation-2: -Central banks have four main monetary policy tools: the reserve requirement, open market operations, the discount rate, and interest on reserves. 1 Most central banks also have a lot more tools at their disposal.
Detailed explanation-3: -Monetary policy refers to the steps taken by a country’s central bank to control the money supply for economic stability. For example, policymakers manipulate money circulation for increasing employment, GDP, price stability by using tools such as interest rates, reserves, bonds, etc.
Detailed explanation-4: -Public Debt (Government Debt) is the debt owed by the government. Whereas monetary policy is framed, devised, and implemented by the RBI. Public Debt does not fall in the ambit of RBI and can never be a part of monetary policy.