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      Question

      Which of the following statements about the FRBM (Fiscal

      Responsibility and Budget Management) framework is correct?
      A It mandates the RBI to maintain the fiscal deficit ceiling. Correct Answer Incorrect Answer
      B It requires the Centre to eliminate revenue deficit and reduce fiscal deficit on a glide path. Correct Answer Incorrect Answer
      C It restricts states from borrowing from the open market. Correct Answer Incorrect Answer
      D It sets monetary policy targets for RBI. Correct Answer Incorrect Answer
      E It prohibits any supplementary grants during a financial year. Correct Answer Incorrect Answer

      Solution

      The FRBM Act aims for long-term fiscal discipline through a glide path for revenue deficit and fiscal deficit, improving fiscal sustainability.

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