Tools of monetary policy to PSL Flashcards
1) The 3 motives for preference for liquidity?
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2) How current account works? The 3 Os?
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3) What is the one asset of any bank?
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4) What are the 3 time liabilities of a bank?
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5) Current Account, Savings account, Demand drafts are obviously demand liabilities. What are the other 2 less obvious demand liabilities?
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6) What is Narrow money?
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7) What is broad money?
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8) What is aggregate money?
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9) What is difference between G-secs and T-bills?
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10) The 3 agencies that buy G-secs and T-bills?
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11) If buyers are not found for Government Securities, who buys them?
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12) Who circulates the coins and 1Rs Notes issued by Government
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13) Why is M1-M4 greater than M0?
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14) What is the liability of RBI In one line?
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15) What is both a liability and an asset for RBI?
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16) Apart from Rupee coins, what are the 3 assets of the issue department of RBI?. Hint:- CBS
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17) What is the one rule that RBI must follow while issuing currency?
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18) Are repo deposits an asset or a liability of the RBI?
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19) Coins and currency in circulation are obviously with public. What part of bank’s money is considered in M0
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20) What is the 3rd source of M0 apart from Banks and Public?
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21) Can the public deposit money with the RBI?
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22) What is the theoretical formula for money multiplier?+ 3 reasons for deviation from this formula?
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23) Why incremental CRR was introduced?
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24) What are the 2 factors on which velocity of money circulation depends?
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25) CRR, SLR are based on which acts?
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26) Is any profit earned on CRR? On SLR?
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27) Explain the conceptual difference between CRR and SLR?
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28) CRR, SLR are explained as percentages of what?
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29) Is there any legal limit on CRR, SLR ?
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30) Does the SLR have an effect on money multiplier?
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31) What is Bank rate?
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32) What is repo rate?
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33) Which are the target institutions for repo rate?
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34) What is another name for Repo rate?
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35) What is the collateral in Repo rate?
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36) What is MSF and how it is different from LAF?
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37) What is the margin between MSF and LAF?
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38) Derive from first principles: What is the difference between the target institutions for MSF and LAF. Which of these two have limits on borrowing?
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39) Why are MSF and LAF less effective in India for monetary policy transmission in India?
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40) What is Tri party repo agreement?
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41) Who is the custodian in tri party repo?
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42) What are the 2 advantages of Tri party repo?
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43) What is the margin between repo and reverse Repo?
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44) what is reverse repo also known as?
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45) What are the 3 “window” operations by RBI?
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46) What is the “policy corridor”?
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47) When is the “policy corridor” altered?
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48) Why do banks borrow usually?
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49) What are the 2 rates in inter bank borrowing?
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50) What is OMO?
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51) What is MSS?
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52) What is Standing deposit facility?
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53) Who recommended Standing Deposit Facility?
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54) When was SDF announced and is it functional today?
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55) Generally explain with examples, the differences between quantitative and qualitative for transmission of Monetary policy
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56) Just name the 4 qualitative tools for Monetary Policy transmission?
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57) Explain margin requirement/LTV ratio?
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58) What is the need for selective credit control?
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59) Explain -ve selective credit control with the 2 examples?
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60) Explain +ve selective credit control with the 2 examples?
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61) When did the RBI first use the word PSL?
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62) How much PSL quota in India and what are the 4 splits in PSL quota?
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63) How much subquota for weaker sections in PSL and what is the subsplit in that?
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64) How much subquota for Agriculture in PSL and what is the subsplit in that?
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65) How much subquota for MSME and KVIC in PSL and how are they defined?
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66) New categories added to PSL in 2015. Expand: PXSSRFV
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67) Across commercial, cooperative and NBFI categories, name the entities on which PSL is not applicable?
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68) Sub category of commercial banks on which 40 % PSL is applicable?
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69) Sub category of commercial banks on which 75 % PSL is applicable?
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70) Differential bank with 40% PSL?
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71) Is PSL applicable on cooperative banks?
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72) What if a company fails to uphold PSL obligations?
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73) What are PSL certificates?
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74) Where PSLC are sold?
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75) What are the 3 categories of PSL under which PSLC are sold?
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76) Explain CRR, SLR and PSL applicablity on RRBs, Cooperatives?
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