Answer-What is the primary purpose of the Reserve Bank of India (RBI) setting the repo rate?

The repo rate is the rate at which commercial banks borrow money from the RBI. A higher repo rate typically reduces inflation by discouraging borrowing and increasing the cost of money in the economy.

Question

What is the primary purpose of the Reserve Bank of India (RB

I setting the repo rate?

A To determine the rate at which banks lend to their customers

B To control inflation by regulating the money supply

C To set the minimum lending rate for banks

D To influence the currency exchange rate

E To regulate the credit risk of banks

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