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The difference between the value of security and the amount of loan sanctioned against these securities is known as: - Economic Applications

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Question

The difference between the value of security and the amount of loan sanctioned against these securities is known as:

Options

  • Credit rationing

  • Margin requirement

  • Direct Action

  • Regulation of consumer credit

MCQ
Fill in the Blanks

Solution

Margin requirement

Explanation:

The disparity between the security's value and the approved loan amount against said securities is referred to as margin requirements. This serves as one of the qualitative instruments for credit control employed by the central bank.

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Monetary Policy of the Central Bank
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Chapter 9: Central Banks - QUESTIONS [Page 213]

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Goyal Brothers Prakashan Economic Application [English] Class 10 ICSE
Chapter 9 Central Banks
QUESTIONS | Q 21. | Page 213
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