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    Question

    What is the main reason green financing carries higher

    credit risk compared to traditional financing?
    A High inflation rates in green sectors Correct Answer Incorrect Answer
    B Limited track records of emerging green technologies Correct Answer Incorrect Answer
    C High-interest rates imposed by financial institutions Correct Answer Incorrect Answer
    D Government subsidies leading to artificial demand Correct Answer Incorrect Answer
    E Strict RBI regulations restricting lending Correct Answer Incorrect Answer

    Solution

    Green financing carries higher credit risk due to the limited track records of emerging green technologies, making investment assessment more complex.

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