Question

Consider the following statement regarding component of Forex reserve in India and identify the incorrect one

i.     Foreign Currency Assets forms the major portion .

ii.     Gold and Silver reserve is part of Forex reserve .

iii.     SDR is one of the component of Forex . 

A Only I Correct Answer Incorrect Answer
B Only II Correct Answer Incorrect Answer
C Only III Correct Answer Incorrect Answer
D All of the above Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

Forex reserves are foreign currency assets held by the central banks of countries . These assets include foreign marketable securities, monetary gold, special drawing rights ( SDRs ) and reserve position in the IMF .

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