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    Question

    Which of the following increases when RBI raises the

    SLR?
    A Liquidity available to banks for lending Correct Answer Incorrect Answer
    B Banks' borrowing cost from RBI Correct Answer Incorrect Answer
    C Amount banks must invest in government securities Correct Answer Incorrect Answer
    D Inflation rate in the economy Correct Answer Incorrect Answer
    E Banks' CRR balance with RBI Correct Answer Incorrect Answer

    Solution

    Increase in SLR reduces banks' lending capacity as more funds are locked in G-Secs.

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