Economics · Monetary Policy Instruments
Which of the following statements is TRUE regarding the Bank Rate in India?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1An increase in Bank Rate by the Central Bank increases the money supply.
- 2Bank Rate is classified as a qualitative instrument of credit control.
- 3Bank Rate requires collateral of government securities to provide long-term credit to financial institutions.
- 4Bank Rate serves as a quantitative and direct instrument of credit control.✓
Correct answer
Bank Rate serves as a quantitative and direct instrument of credit control.
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