To stop the rupee from falling too fast, the RBI is most likely to

sell dollars from its reservesCorrect answerYour answerbuy dollarsCorrect answerYour answerprint more rupeesCorrect answerYour answercut the repo rate sharplyCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

Selling dollars adds to their supply in the market, which supports the rupee.

Concept: Intervention to support the rupee
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsManaged floating

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Ten questions from Foreign Exchange Rate, at your own pace.

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Ten questions from Foreign Exchange Rate, at your own pace.

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To stop the rupee from falling too fast, the RBI is most likely to

Explanation