Question

Qualitative credit control by a Central Bank exercised by which of the following measure ?
1.Credit rationing
2. Consumers credit regulation
3. Changes in margin requirement on security loans.
Select the correct answer using the codes given below:

• A. 1 , 2 and 4
• B. 2 , 3 and 4
• C. 1 , 3 and 4
• D. 1 , 2 and 3

Answer 1

The correct option is D 1 , 2 and 3

Qualitative credit control by a Central Bank exercised by the credit rationing consumes credit regulation and changes in margin requirement on secured loans. A variable reserve ratio is used as a quantitative credit control tool.
Rationing of credit is a selective method adopted by the Central Bank for the controlling and regulating the purpose for which credit is granted or allocated by the commercial bank
In fact rationing of credit and capital is the logical concomitant of authoritarian planning.