UPSC Exam > UPSC Questions > Consider the following pairs:1. Ways and Mea...
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Consider the following pairs:
1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.
2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.
3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.
4. Normal WMA: Interest rate is two percentage points more than the repo rate.
How many pairs given above are correctly matched?
2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.
3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.
4. Normal WMA: Interest rate is two percentage points more than the repo rate.
How many pairs given above are correctly matched?
- a)Only one pair
- b)Only two pairs
- c)Only three pairs
- d)All four pairs
Correct answer is option 'OPTIONB'. Can you explain this answer?
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Most Upvoted Answer
Consider the following pairs:1. Ways and Means Advances (WMA): Tempor...
1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage temporary mismatches in receipts and expenditures, not long-term fiscal deficits.
- Incorrectly matched
- Incorrectly matched
2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.
- Correctly matched
- Correctly matched
3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.
- Correctly matched
- Correctly matched
4. Normal WMA: Interest rate is charged at the repo rate, not two percentage points more than the repo rate (which applies to overdrafts).
- Incorrectly matched
- Incorrectly matched
Thus, only pairs 2 and 3 are correctly matched.
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Consider the following pairs:1. Ways and Means Advances (WMA): Tempor...
Overview of the Pairs
In this question, we need to evaluate the correctness of the given pairs related to financial instruments and facilities provided by the Reserve Bank of India (RBI).
1. Ways and Means Advances (WMA)
- Correctness: WMA is indeed a temporary loan facility provided by the RBI.
- Clarification: It helps states manage short-term cash flow mismatches, not specifically long-term fiscal deficits.
2. Special Drawing Facility (SDF)
- Correctness: This facility is provided against the collateral of government securities.
- Clarification: It is not exclusively for state governments or Union Territories; it can be utilized by others under certain conditions too.
3. Auction Treasury Bills (T-Bills)
- Correctness: T-Bills are short-term debt instruments issued by the government.
- Clarification: They are indeed issued through a competitive bidding process, making this pair correctly matched.
4. Normal WMA
- Correctness: The interest rate on Normal WMA is not fixed at two percentage points above the repo rate.
- Clarification: This statement can be misleading as the actual interest rate can vary based on the prevailing economic conditions.
Conclusion
Based on the assessment:
- Correctly Matched:
- Pair 1: Incorrect
- Pair 2: Incorrect
- Pair 3: Correct
- Pair 4: Incorrect
Thus, only one pair (Auction Treasury Bills) is correctly matched, leading to the conclusion that the answer is OPTION B (Only two pairs), considering the nuances in the definitions of WMA and SDF.
In this question, we need to evaluate the correctness of the given pairs related to financial instruments and facilities provided by the Reserve Bank of India (RBI).
1. Ways and Means Advances (WMA)
- Correctness: WMA is indeed a temporary loan facility provided by the RBI.
- Clarification: It helps states manage short-term cash flow mismatches, not specifically long-term fiscal deficits.
2. Special Drawing Facility (SDF)
- Correctness: This facility is provided against the collateral of government securities.
- Clarification: It is not exclusively for state governments or Union Territories; it can be utilized by others under certain conditions too.
3. Auction Treasury Bills (T-Bills)
- Correctness: T-Bills are short-term debt instruments issued by the government.
- Clarification: They are indeed issued through a competitive bidding process, making this pair correctly matched.
4. Normal WMA
- Correctness: The interest rate on Normal WMA is not fixed at two percentage points above the repo rate.
- Clarification: This statement can be misleading as the actual interest rate can vary based on the prevailing economic conditions.
Conclusion
Based on the assessment:
- Correctly Matched:
- Pair 1: Incorrect
- Pair 2: Incorrect
- Pair 3: Correct
- Pair 4: Incorrect
Thus, only one pair (Auction Treasury Bills) is correctly matched, leading to the conclusion that the answer is OPTION B (Only two pairs), considering the nuances in the definitions of WMA and SDF.
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Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer?
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Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer?.
Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer?.
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ample number of questions to practice Consider the following pairs:1. Ways and Means Advances (WMA): Temporary loan facility provided by RBI to manage long-term fiscal deficits.2. Special Drawing Facility (SDF): Provided against the collateral of government securities held by the state governments or Union Territories.3. Auction Treasury Bills (T-Bills): Short-term debt instruments issued by the government through a competitive bidding process.4. Normal WMA: Interest rate is two percentage points more than the repo rate.How many pairs given above are correctly matched?a)Only one pairb)Only two pairsc)Only three pairsd)All four pairsCorrect answer is option 'OPTIONB'. Can you explain this answer? tests, examples and also practice UPSC tests.
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