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What is the purpose of open market operations (OMOs) conducted by the RBI?
  • a)
    To regulate the availability of money in the economy
  • b)
    To control inflation and stimulate economic growth
  • c)
    To manage the foreign exchange reserves
  • d)
    To regulate interest rates in the banking system
Correct answer is option 'A'. Can you explain this answer?
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What is the purpose of open market operations (OMOs) conducted by the ...
Open market operations (OMOs) conducted by the RBI have the purpose of regulating the availability of money in the economy. OMOs involve the purchase and sale of government securities by the RBI in the open market. When the RBI buys government securities, it injects money into the economy, increasing the availability of money. On the other hand, when the RBI sells government securities, it absorbs money from the economy, reducing the availability of money. By conducting OMOs, the RBI can manage liquidity in the banking system and influence interest rates.
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What is the purpose of open market operations (OMOs) conducted by the RBI?a)To regulate the availability of money in the economyb)To control inflation and stimulate economic growthc)To manage the foreign exchange reservesd)To regulate interest rates in the banking systemCorrect answer is option 'A'. Can you explain this answer?
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What is the purpose of open market operations (OMOs) conducted by the RBI?a)To regulate the availability of money in the economyb)To control inflation and stimulate economic growthc)To manage the foreign exchange reservesd)To regulate interest rates in the banking systemCorrect answer is option 'A'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about What is the purpose of open market operations (OMOs) conducted by the RBI?a)To regulate the availability of money in the economyb)To control inflation and stimulate economic growthc)To manage the foreign exchange reservesd)To regulate interest rates in the banking systemCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the purpose of open market operations (OMOs) conducted by the RBI?a)To regulate the availability of money in the economyb)To control inflation and stimulate economic growthc)To manage the foreign exchange reservesd)To regulate interest rates in the banking systemCorrect answer is option 'A'. Can you explain this answer?.
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