Which one of the following statement is correct?
(a) RBI acts as banker to the Central Government as well as State governments
(b) Central Bank creates credit in the economy
(c) All financial institutions are banking institutions
(d) One rupee note and all coins in India are issued by Reserve Bank of India.
Ans – (a)
(a) RBI acts as a banker to the Central Government as well as State Governments
(b) The Central Bank does not create credit, it’s the commercial bank that creates credit in the economy.
(c) All financial institutions are not banking institutions. For a financial institution to be a bank It must accept deposits and advance the loans.
(d) One rupee not and all coins in India are issued by the Ministry of Finance.