Economics · Monetary Economics
What will be the direct effect of an increase in foreign exchange assets held by the Reserve Bank of India?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1An increase in High-Powered Money (Reserve Money)✓
- 2An automatic increase in market interest rates
- 3A decrease in Broad Money (M3)
- 4A decrease in Narrow Money (M1)
Correct answer
An increase in High-Powered Money (Reserve Money)
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