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[WpProQuiz 43]
Daily Quiz : UPSC Prelims Marathon – February 21
Comments
52 responses to “Daily Quiz : UPSC Prelims Marathon – February 21”
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3/5
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You have reached 3 of 5 scores, (60%)
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I do agree crowding in of investment
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1. I would urge you to view the picture i have attached. I have highlighted the exact part from where the question has been picked. 🙂
2. I have not heard VD Reddy’s speech, but i am pretty sure the source is ramesh singh’s book, the highlighted part has been verbatim reproduced in this question.
3. I have never said that it will ‘definitely lead to lower economic growth’. All i am putting forth is the source, and my justification to validate what has been produced in the source material.
ATB friend 🙂
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@forumias-7f07ca326ce76cdde680e4b3d568bce8:disqus please include explanations in answer.
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Interest rate is what bank offers you, savings rate is the percentage of what you are able to set aside (save in bank) from your income. More inflation means lower savings rate and lower real interest rate. Nominal interest rates are expected to be same.
If inflation is high, my expenditure would be more, and my saving rate would decline. Earlier, I saved 40,000 from my salary of 1 lakh. Now, I am able to save only 20,000 as inflation has lead me to spend more on groceries.
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Savings rate and interest rate are different. Interest rate is what bank offers you, savings rate is the percentage of what you are able to set aside (save in bank) from your income. More inflation means lower savings rate and lower real interest rate. Nominal interest rates are expected to be same.
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I think term you are looking for, is interest rate; that would be same.
Savings rate is the money a person sets aside for future. If inflation is high, my expenditure would be more, and my saving rate would decline. Earlier, I saved 40,000 from my salary of 1 lakh. Now, I am able to save only 20,000 as inflation has lead me to spend more on groceries.
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but RBI buys govt securities during expansionary policy to boost the economic growth. This has been taken from Y V Reddy speech who describes a particular situation that occurred in India. If expansionary policy is not guided properly it may lead to liquidity trap. So, it is wrong to say, that it will definitely lead to lower economic growth.
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4/5
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Thnx for clear explanation..
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yes..
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3/5
Learning – Boom = High Inflation
RBI Purchasing GSec might not result in Economic Growth, that’s not explicit -
4/5
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yes, according to me 2nd one is more correct.
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Thank you sir!
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Completely agree with u forum .
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4/5
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please provide the solution
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doubt- Bhai saving rate seih meaning kya hai yaha par. Is it the rate which is offered by banks on savings or is it the rate at which people save. Though second one is more apt.But both are correct according to me.
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Bhai saving rate seih meaning kya hai yaha par. Is it the rate which is offered by banks on savings or is it the rate at which people save. Though second one is more apt. Though both are correct according to me.
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Good. Lesser the score, more the chances of improvement 🙂
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bhai what is inflation.. general rise in price level.now when prices rise and your income is constant wouldnt your savings be eroded..
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it should.person would need to spend more.
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It lowers the value of the savings, but does not per-se decrease the rate of saving does it?
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Daily Quiz: February 21
Results
3 of 5 questions answered correctlyYour time: 00:03:04
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Results
2 of 5 questions answered correctly
Your time: 00:04:33
You have reached 2 of 5 scores, (40%)
Average score 35.31%
Your score 40%
Categories
Economy40%
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4/5
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Thanks . I was doubtful on the 3rd point. Yes , it does not go parallel with Economic Growth.
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5/5
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It works in reciprocity.
low savings => more more to spend => more demand => high inflation and as u have said
Inflation also erode the savings of people. -
Lower savings rate – It implies people will have less saving habits. so, they will spend more => more demand => more growth of economy.
But also due to high liquidity in market and more demand of people => high inflation. -
Its simple though….
Statement 1: If Govt is getting money from RBI (Borrowing or Printing new notes), it would led to increase money supply in Economy. Hence Inflation.
Statement 2: When you are taking money out of your reserves or Getting Fresh advances, hence spending more than saving.
Statement 3: High inflation doesnt go in parallel to HIGH_ECONOMY_GROWTH. -
Inflation Erode the Savings of people!
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Results
5 of 5 questions answered correctlyYour time: 00:02:31!
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Results
4 of 5 questions answered correctlyYour time: 00:02:23
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Question 2 source is Ramesh SIngh wala Economics book (for anyone interested.)
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@forumias-7f07ca326ce76cdde680e4b3d568bce8:disqus ……how does saving rate get affected in ques 2 ?…. plzzz explain
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2/5 🙁 Lowest till date
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can u explain all the soultions
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can u ecplain all the questions please
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please explain all the questions
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can anybody explain all the answers
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Q2: Lower savings rate? How? RBI purchasing primary issue causes crowding out effect and hence inflation…how does it affect savings rate?
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Can anyone explain questions no.2..lower savings rate???means??
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4/5
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Can somebody please give me explanation for Q2 ? TIA
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3/5
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Good.
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2/5
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2/5
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3/5 time 1:50
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