Topic Details (Notes format)

Monetary Policy in India

Subject: Economics

Book: Comprehensive Indian Economy

Monetary policy revolves around regulating the money supply and interest rates to achieve price stability and sustainable growth. The Reserve Bank of India (RBI) uses tools like the repo rate, reverse repo rate, CRR, and open market operations to manage liquidity and inflation. Notably, an inflation-targeting framework was introduced to ensure accountability, with a Monetary Policy Committee deciding rate changes. From an exam viewpoint, remember how policy stances (accommodative, neutral, or hawkish) affect credit availability and consumer spending, and track how inflation targets guide RBI decisions in balancing growth with price stability.

Practice Questions

Which is the largest source of tax revenue for the Government of India?

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Which of the following is an example of a non-renewable resource?

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Which of the following is an example of a capital receipt for the government?

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What does the “Phillips Curve” show?

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Which of the following is NOT an example of a direct tax?

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Which of the following is an example of fiscal policy?

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What is the term for the ability of an economy to produce more output from the same inputs?

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What does the term “capital account” refer to in the balance of payments?

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What is the meaning of “disguised unemployment”?

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What is “open market operations” (OMO)?

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