The term 'Repo Rate' refers to the rate at which: MCQ with Answer and Explanation

Question
The term 'Repo Rate' refers to the rate at which:
A. RBI lends to commercial banks against securities
B. Government borrows from RBI
C. Commercial banks lend to RBI
D. RBI borrows from commercial banks
Answer: Option A
Solution (By JKSSB Mock Tests)
Repo rate is the rate at which the Reserve Bank of India lends money to commercial banks against government securities for short-term needs.
This question belongs to: Economy GK Economy Set 1
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Practice More Economy Set 1 Questions

Question #1
In the context of money, 'Near Money' refers to:
A. Currency notes and coins
B. Highly liquid assets that can be quickly converted into money
C. Demand deposits only
D. Gold and silver only
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Correct Answer: Option B

Explanation:
Near money refers to highly liquid assets such as time deposits, treasury bills and savings bonds that can be easily converted into cash with little loss of value.
This question belongs to: Economy GK Economy Set 1
Question #2
The 'spot market' in foreign exchange deals with:
A. options only
B. future delivery of currencies
C. immediate delivery of currencies
D. futures only
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Correct Answer: Option C

Explanation:
Spot foreign exchange transactions involve immediate delivery of currencies.
This question belongs to: Economy GK Economy Set 1
Question #3
The term 'Current Account Deficit' indicates:
A. Excess of capital inflows over outflows
B. Excess of imports of goods and services over exports
C. Surplus in the overall balance of payments
D. Excess of government expenditure over revenue
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Correct Answer: Option B

Explanation:
Current Account Deficit occurs when the value of imports of goods, services and transfers exceeds the value of exports of goods, services and transfers.
This question belongs to: Economy GK Economy Set 1
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