Commerce Exam > Commerce Questions > Directions: In the following questions, a st...
Start Learning for Free
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:
Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.
Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.
- a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).
- b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).
- c)Assertion (A) is true but reason (R) is false.
- d)Assertion (A) is false but reason (R) is true.
Correct answer is option 'D'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
Directions: In the following questions, a statement of assertion (A) ...
The term 'REPO' refers to a repurchase option or agreement. It is a monetary tool used by the RBI to allow commercial banks to borrow money, when in need, against collaterals such as government bonds and treasury bills. While lending money to commercial banks, the apex bank of India charges a certain amount of interest, which is called repo rate. This present repo rate is subject to change as per the RBI changing policies. In the situation of shortage of funds, commercial lenders can reach out to RBI to secure funds for a specified tenure by depositing government bonds as collateral. Repo rate is the rate at which commercial banks borrow money from RBI by using government bonds as collateral to achieve its fiscal goals.
View all questions of this test
Most Upvoted Answer
Directions: In the following questions, a statement of assertion (A) ...
Assertion and Reasoning
Assertion: Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.
Reason: Both repo rate and reverse repo rate are fixed by the Reserve bank of India, as it is an apex bank.
Explanation
Repo Rate: The repo rate is the rate at which commercial banks borrow money from the Reserve Bank of India. When banks have a shortage of funds, they can borrow money from the central bank, and the rate at which this borrowing takes place is the repo rate. The Reserve Bank of India (RBI) sets this rate, and it is one of the most important tools used by the central bank to control inflation.
Reverse Repo Rate: The reverse repo rate is the rate at which commercial banks lend money to the Reserve Bank of India. When banks have excess funds, they can park this money with the central bank, and the rate at which this lending takes place is the reverse repo rate. The Reserve Bank of India (RBI) sets this rate, which is typically lower than the repo rate.
Explanation of Assertion: The assertion is incorrect because both repo rate and reverse repo rate are set by the Reserve Bank of India. The repo rate is set by the RBI, and commercial banks borrow money from the central bank at this rate. The reverse repo rate is also set by the RBI, and commercial banks lend money to the central bank at this rate. Therefore, the assertion that only repo rate is fixed by the RBI is incorrect.
Explanation of Reason: The reason is incorrect because it contradicts the assertion. The reason states that both repo rate and reverse repo rate are set by the RBI, which is correct. However, the assertion states that only repo rate is fixed by the RBI, which is incorrect. Therefore, the reason cannot be the correct explanation of the assertion.
Conclusion: The correct option is D, Assertion (A) is false, but Reason (R) is true.
Assertion: Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.
Reason: Both repo rate and reverse repo rate are fixed by the Reserve bank of India, as it is an apex bank.
Explanation
Repo Rate: The repo rate is the rate at which commercial banks borrow money from the Reserve Bank of India. When banks have a shortage of funds, they can borrow money from the central bank, and the rate at which this borrowing takes place is the repo rate. The Reserve Bank of India (RBI) sets this rate, and it is one of the most important tools used by the central bank to control inflation.
Reverse Repo Rate: The reverse repo rate is the rate at which commercial banks lend money to the Reserve Bank of India. When banks have excess funds, they can park this money with the central bank, and the rate at which this lending takes place is the reverse repo rate. The Reserve Bank of India (RBI) sets this rate, which is typically lower than the repo rate.
Explanation of Assertion: The assertion is incorrect because both repo rate and reverse repo rate are set by the Reserve Bank of India. The repo rate is set by the RBI, and commercial banks borrow money from the central bank at this rate. The reverse repo rate is also set by the RBI, and commercial banks lend money to the central bank at this rate. Therefore, the assertion that only repo rate is fixed by the RBI is incorrect.
Explanation of Reason: The reason is incorrect because it contradicts the assertion. The reason states that both repo rate and reverse repo rate are set by the RBI, which is correct. However, the assertion states that only repo rate is fixed by the RBI, which is incorrect. Therefore, the reason cannot be the correct explanation of the assertion.
Conclusion: The correct option is D, Assertion (A) is false, but Reason (R) is true.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer?
Question Description
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer?.
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer?.
Solutions for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion : Repo rate is fixed by the Reserve bank of India, while Reverse repo rate is fixed by the commercial bank themselves.Reason: Both repo rate and reverse repo rate is fixed by the Reserve bank of India ,as it is an apex bank.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup