2013 · Q19
Consider the following statements
- 1Repo Rate is the interest rate at which RBI lends to commercial banks for short period.
- 2Reverse Repo Rate is the interest rate which RBI pays to commercial banks on short-term deposits.
- 3Gap between Repo Rate and Reverse Repo Rate has been declining in India in the recent past.
Which of the statements above is/are not correct?
indian-polity-economyeconomy-fundamentals
- AOnly 1
- BOnly 2
- COnly 3
- D2 and 3
Explanation
Statements 1 and 2 correctly define repo and reverse repo rates; statement 3 is not correct, so the answer is only 3.