GK
BANKING AWARENESS AND SEBI
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Act as private sector lending arm of the World Bank
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Finance investment loans to developing countries
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Arrange international deposits from banks
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Help to solve Balance of Payment problems of member countries.
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Detailed explanation-1: -Providing loans and concessional financial assistance to member countries experiencing actual or potential balance-of-payments problems is a core responsibility of the IMF.
Detailed explanation-2: -Unlike development banks, the IMF does not lend for specific projects. Instead, the IMF provides financial support to countries hit by crises to create breathing room as they implement policies that restore economic stability and growth. It also provides precautionary financing to help prevent crises.
Detailed explanation-3: -The IMF was created to help stabilize exchange rates in the fixed exchange rate system. In particular, member countries contribute reserves to the IMF, which is then enabled to lend money to countries suffering balance of payments problems.