Assertion (A) : Ceiling on foreign exchange for a host of current account transaction heads was lowered in the year 2000. Reason (R) : There was a fall in foreign currency assets also.

A

Both A and R are individually true, and R is the correct explanation of A

B

Both A and R are individually true, but R is NOT a correct explanation of A

C

A is true, but R is false

D

A is fasle, but R is true

Result

Your answer: — · Correct: A

Explanation

In the year 2000, India experienced pressure on its balance of payments due to rising international crude oil prices, which caused a fall in foreign currency assets. In response, the Reserve Bank of India (RBI) introduced measures in August 2000 to stabilize the rupee and conserve foreign exchange.

Assertion (A) is True: The RBI temporarily lowered ceilings and entitlements for a variety of current account transactions (notably halving the EEFC account entitlement from 50% to 25%) to curb demand for foreign currency.
Reason (R) is True: These measures were a direct consequence of the decline in foreign currency assets observed during the first half of the 2000-01 fiscal year.

Since the fall in assets was the reason for tightening the exchange ceilings, R is the correct explanation of A.

How others answered

Each bar shows the % of students who chose that option. Green bar = correct answer, blue outline = your choice.

Community Performance

Out of everyone who attempted this question.

48%

got it right

Change set

Question map

Assertion (A) : Ceiling on foreign exchange for a host of current account transaction heads was lowered in the year 2000. Reason (R) : There was a fall in foreign currency assets also.

Explanation

SIMILAR QUESTIONS

4 Cross-Linked PYQs