Question
Suppose, there is huge inflow of foreign currencies. To
avoid drastic appreciation, RBI had to absorb them in exchange of domestic currencies. Now to control the increased money supply, RBI sells Government securities. This is called:Solution
When there is excess inflow of foreign currencies, RBI absorbs most of it to prevent any adverse effect. Such drastic inflow caused steep rise of exchange rate causing fall of export and other negative consequences. Thus RBI decides to absorb foreign currencies (dollars) from the market. Since it will done in exchange for rupees, it will increase money supply in the market. This may leads to the issue of inflation. Thus now RBI sales Government Securities to absorb excess money supply from the market. Since this sterilizes the economy from many adverse shocks, the entire operation is called sterilization.
In fund flow analysis, which of the following is considered a source of funds?
When is the audit strategy prepared?
Under which menu heading does a balance sheet fall in Tally ERP 9?
In a Bank Guarantee transaction, which parties are typically involved?
You are an analyst working in the finance department of a large corporation. Your team is tasked with evaluating the company's total debt service costs ...
Which of the statements is correct with respect to a company that has announced a bonus issue according to Rule 14 of the Companies (Share Capital and D...
Under the Income-tax Act, Deferred Tax Asset is recognized when:
Digital signature, one of the important components of e-commerce is defined according to Section _________ of Information Technology Act, 2000.
Which type of insurance contract provides a guaranteed payout to the policyholder regardless of the occurrence of the insured event?
If a corporate assessee has paid Rs. 15,000 as excess service tax during the previous half-year ending period, this excess amount can be adjusted agains...
