question_answer

On 8th November, 2016, Prime Minister Narendra Modi banned Rs. 500 and Rs. 1,000 currency notes by implementing demonetisation policy. In the context of this statement, explain any four features of demonetisation.

Answer:

Features of demonetisation are as follows: (any four) (i) It is a radical monetary step in which a currency unit's status as a legal tender is declared invalid. (ii) It usually occurs when their is a change in currency by the government. (iii) It is an attempt to make a cashless, corruption free and digital society. (iv) It is a strict measure by the government against tax evasion. (v) It helps in channelising more savings into the formal financial system.