Current Affairs Quiz 11 September 2024
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Current Affairs Quiz 11 September 2024 for UPSC Prelims
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- Question 1 of 5
1. Question
Consider the following statements:
1. Decrease in the Cash Reserve Ratio results in a decline in the borrowing cost of funds.
2. Increase in Reverse Repo Rate will discourage banks from depositing surplus with the Central Bank.
3. Decrease in Statutory Liquidity Ratio leads to a decline in interest rate.
4. Selling of government securities by the Central Bank results in inflation in the economy.
Which of the statements given above are correct?CorrectAnswer: A
• Reverse Repo Rate is the interest rate at which the RBI borrows money from banks for
the short term. RBI increases the reverse repo rate to provide incentive to the banks
to deposit surplus funds with it to earn higher interest on them. In this manner it
reduces the supply of money in the system, thus controlling inflation. Similarly, RBI
cuts the reverse repo rate to increase the money supply. So, statement 2 is not
correct.• Open market operations involve the sale and purchase of government securities and
treasury bills by the Reserve Bank of India (RBI) to regulate the money supply in the
economy. The purchase of the government securities from the market leads to an
increase in money supply in the economy. On the contrary, when RBI sells
government securities, it decreases money supply in the economy thereby
controlling inflation. So, statement 4 is not correct.IncorrectAnswer: A
• Reverse Repo Rate is the interest rate at which the RBI borrows money from banks for
the short term. RBI increases the reverse repo rate to provide incentive to the banks
to deposit surplus funds with it to earn higher interest on them. In this manner it
reduces the supply of money in the system, thus controlling inflation. Similarly, RBI
cuts the reverse repo rate to increase the money supply. So, statement 2 is not
correct.• Open market operations involve the sale and purchase of government securities and
treasury bills by the Reserve Bank of India (RBI) to regulate the money supply in the
economy. The purchase of the government securities from the market leads to an
increase in money supply in the economy. On the contrary, when RBI sells
government securities, it decreases money supply in the economy thereby
controlling inflation. So, statement 4 is not correct. - Question 2 of 5
2. Question
Which of the following is not a member of ‘Gulf Cooperation Council’?
CorrectAns: (a)
IncorrectAns: (a)
- Question 3 of 5
3. Question
Consider the following statements:
1. Ajman is one of the seven Emirates of the UAE.
2. Ras al-Khaimah was the last Sheikhdom to join the UAE.
Which of the statements given above is/are correct?CorrectAns: C
IncorrectAns: C
- Question 4 of 5
4. Question
In the South Atlantic and South-Eastern Pacific regions in tropical latitudes, cyclone does not originate. What is the reason?
CorrectAns: (b)
IncorrectAns: (b)
- Question 5 of 5
5. Question
Consider the following statements with reference to tax buoyancy:
1. It measures tax revenues with respect to changes in Gross Domestic Production (GDP).
2. Higher tax buoyancy rate indicates lesser tax collection.
Which of the statements given above is/are correct?CorrectAnswer: A
Tax revenues are closely related to economic activity, rising during periods of faster
economic growth and declining during recessions. The higher tax buoyancy rate
means surplus tax revenue by way of tax collection. So, statement 2 is not correct.IncorrectAnswer: A
Tax revenues are closely related to economic activity, rising during periods of faster
economic growth and declining during recessions. The higher tax buoyancy rate
means surplus tax revenue by way of tax collection. So, statement 2 is not correct.
