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Question

The Economic Survey 2021-22, talks about which of the following approach adopted by the government to COVID-19 ?

A Hansen Approach Correct Answer Incorrect Answer
B Barbell approach Correct Answer Incorrect Answer
C Bond ladder approach Correct Answer Incorrect Answer
D Bullet Approach Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

The Government of India opted for a “Barbell Strategy” that combined a bouquet of safety-nets to cushion the impact on vulnerable sections of society/business, with a flexible policy response based on a Bayesian updating of information. This is a common strategy used in financial markets to deal with extreme uncertainty by combining two seemingly disparate legs. The iterative leg of this strategy is the same as the “Agile” approach that uses feedback-loops, and real-time adjustment.

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