GyanGramIf the RBI decides to adopt an expansionist monetary policy, which of the following would it not do? 1. Cut a…
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If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do?
1. Cut and optimize the Statutory Liquidity Ratio
2. Increase the Marginal Standing Facility Rate
3. Cut the Bank Rate and Repo Rate
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• Correct Answer: B
• Raising MSF rate is contractionary; RBI would not do this under expansionary policy.
• Cutting SLR, Bank Rate, and Repo Rate injects liquidity and expands money supply.
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