The 'monetary transmission mechanism' refers to: MCQ with Answer and Explanation

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The 'monetary transmission mechanism' refers to:

A. the transmission of money across banks

B. the exchange of old currency notes

C. the process by which monetary policy changes affect output and inflation

D. the printing of new currency

Answer: Option C

Solution (By JKSSB Mock Tests)

Monetary transmission is the process through which policy rate changes affect the real economy.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

The 'Administrative Tribunals' are established under which article?

A. Article 329

B. Article 323A

C. Article 324

D. Article 338

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Correct Answer: Option B

Explanation:
Administrative Tribunals are established under Article 323A.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Goods and Services Tax' on chocolates is:

A. 28%

B. 12%

C. 18%

D. 5%

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Correct Answer: Option C

Explanation:
Chocolates attract 18% GST.

This question belongs to: Economy GK Economy Set 1

Question #3

Foreign Direct Investment is distinguished from Foreign Portfolio Investment mainly by:

A. the amount of investment

B. investment only in government securities

C. short-term currency trading

D. lasting interest and managerial control

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Correct Answer: Option D

Explanation:
FDI involves lasting interest and managerial control, while FPI does not.

This question belongs to: Economy GK Economy Set 1

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