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      Question

      As per RBI’s new guidelines, what is the minimum

      outstanding amount required for state government bonds to be eligible for STRIPS trading?    
      A ₹5 billion Correct Answer Incorrect Answer
      B ₹8 billion Correct Answer Incorrect Answer
      C ₹10 billion Correct Answer Incorrect Answer
      D ₹15 billion Correct Answer Incorrect Answer
      E ₹12 billion Correct Answer Incorrect Answer

      Solution

      Explanation:    
      The RBI has extended STRIPS trading to state government bonds, aligning with central government securities. For a bond to qualify, it must have a minimum outstanding amount of ₹10 billion , be a fixed-coupon bond, and have a residual maturity of up to 14 years. STRIPS allow the principal and interest portions of bonds to be traded separately, enhancing liquidity and debt management flexibility.    

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