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Which among the following cannot be called an anti-inflationary measure?

  1. A
    Raising the bank rates
  2. B
    Raising the Reserve Ratio Requirements
  3. C
    Purchase of securities from the open markets
  4. D
    Rationing of the credit

Solution & Step-by-step Explanation

Purchasing government securities from the open market (Open Market Operations) by the central bank injects liquidity and increases the money supply within the banking system. This expansionary stance increases aggregate demand and acts as an inflationary measure, rather than an anti-inflationary one.

Practice this question

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Which among the following cannot be called an anti-inflationary measure?
A
Raising the bank rates
B
Raising the Reserve Ratio Requirements
C
Purchase of securities from the open markets
D
Rationing of the credit

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InflationMonetary PolicyReserve Bank of India

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