Correct Answer: Correct answer is: (B) I, II, III and IV are correct.
Exam Relevance: UPSC, SSC, HSSC, Banking Exams
Difficulty: Moderate
Concept notes: The correct answer is based on the current structure and functioning of the Monetary Policy Committee (MPC) in India.
Common Mistakes: Students may incorrectly assume that the MPC does not have a fixed tenure for its members or that the monetary policy is reviewed less frequently.
Explanations: The benchmark policy rate (Repo Rate) is indeed determined by the Monetary Policy Committee (MPC), which is a high-powered committee. The MPC consists of six members, including the RBI Governor. Three members of the MPC are appointed by the Central Government with a fixed tenure of four years. The monetary policy is reviewed bimonthly, which means twice every month. Therefore, all the statements I, II, III, and IV are correct.
Option Analysis: - Option A: This option is incorrect because it omits the correct statement IV.
- Option B: This option is correct as it includes all the correct statements I, II, III, and IV.
- Option C: This option is incorrect because it only includes the correct statement IV and omits the other correct statements.
- Option D: This option is incorrect because it suggests that none of the statements are correct, which is false.
Mnemonic: RBI, MPC, Repo, Bimonthly
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