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UPSC Economics Business and Foreign Trade / व्यापार और विदेश व्यापार Question Bank Fiscal and Monetary Policy

  • question_answer
          Which of the following refers to mat part of deficit for which the government borrows from the RBI?
    1.  Primary deficit    
    2.  Secondary deficit
    3.  Regulatory deficit  
    4.  Monetised deficit

    A) 1 only  

    B)        1 and 2

    C) 3 only

    D)                                4 only

    Correct Answer: D

    Solution :

    Monetised deficit was adopted by India in 1997-98. It refers to that part of deficit for which the government borrows from the RBI. To meet the government?s such requirements, the RBI prints fresh currency, as a result of which the economy gets monetized


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