Which one of the following is not a function of Reserve Bank of India ?

examrobotsa's picture

Submitted by examrobotsa on

Q: 6 (CAPF/2009)

Which one of the following is not a function of Reserve Bank of India ?

question_subject: 

Economics

question_exam: 

CAPF

stats: 

0,144,40,10,6,144,24

keywords: 

{'reserve bank': [1, 0, 3, 4], 'foreign exchange reserve': [0, 0, 0, 1], 'rupee coin': [0, 0, 1, 2], 'banker': [0, 0, 4, 0], 'india': [8, 1, 7, 13], 'government': [5, 0, 0, 1], 'credit': [0, 2, 4, 6], 'issuing': [0, 0, 1, 0], 'function': [11, 2, 3, 13]}

Option 3, which states that the issuance of one rupee coin and note is not a function of the Reserve Bank of India (RBI), is the correct answer.

Option 1 states that the RBI acts as the banker to the government. This means that the RBI manages the financial transactions, provides banking services, and manages the government`s accounts and finances.

Option 2 states that the RBI is responsible for keeping foreign exchange reserves. This means that the RBI manages the country`s foreign currency assets, including maintaining a reserve of foreign currencies to ensure stability in international trade and manage exchange rate fluctuations.

Option 4 states that the RBI regulates credit in the country. This means that the RBI sets guidelines and policies that govern and control the lending and borrowing activities of banks and financial institutions. It establishes credit control measures to manage inflation, stabilize the economy, and ensure the stability of the financial system.

Therefore, only option 3 does not align with the functions of the RBI. It should be noted that the issuance of one rupee coin and note is the responsibility of the Government of India and not the RBI.

In conclusion, the RBI`s primary functions include acting as the banker to the government, managing foreign exchange reserves, and regulating credit in the country.