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      Question

      Under Section 45U of the RBI Act, 1934, 'money market

      instruments' include debt instruments of original or initial maturity up to what period?
      A Six months Correct Answer Incorrect Answer
      B Ninety days Correct Answer Incorrect Answer
      C Two years Correct Answer Incorrect Answer
      D One year Correct Answer Incorrect Answer
      E Three years Correct Answer Incorrect Answer

      Solution

      Section 45U(b), under Chapter IIID dealing with regulation of transactions in derivatives, money market instruments and securities, defines 'money market instruments' to include call or notice money, term money, repo, reverse repo, certificate of deposit, commercial usance bill, commercial paper and such other debt instrument of original or initial maturity up to one year as the Bank may specify. The defining maturity ceiling for money market instruments is therefore one year.

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