Quiz on Quantitative Methods in Banking

What are the quantitative instruments used by the RBI related to?

• Quality of money

• Quantity and volume of money

• Interest rates

• Banking regulations

What is the bank rate policy used for by the RBI?

• Regulating foreign exchange

• Setting up new banks

• Encouraging borrowing

• Controlling inflation

What does CRR refer to in the banking context?

• Cash Reserve Ratio

• Credit Rating Requirement

• Commercial Real Estate Ratio

• Central Regulatory Rule

What is SLR in the banking sector?

• Statutory Loan Ratio

• Systematic Liquidity Requirement

• Secured Lending Rate

• Statutory Liquidity Ratio

What is the purpose of Open Market Operations (OMO) by the RBI?

• To regulate bank mergers

• To control government spending

• To influence interest rates

• To manage foreign exchange reserves

What is the Repo Rate used for by commercial banks?

• To control inflation

• To encourage borrowing

• To regulate stock markets

• To manage foreign investments

When does the RBI increase the reverse repo rate?

• During economic recession

• To control inflation

• To boost exports

• To encourage foreign investments

What is the minimum rate at which the central bank lends money known as?

• Repo Rate

• Reverse Repo Rate

• Interest Rate

• Bank Rate

What is the purpose of Legal Reserve Ratios in commercial banks?

• To regulate stock markets

• To manage foreign exchange rates

• To maintain liquidity and control credit

• To control government spending

What happens when RBI sells securities in the money market?

• Interest rates decrease

• Money supply increases

• Money supply decreases

• Interest rates increase