SSC Economics Sample Paper NCERT Sample Paper-4

  • question_answer
    What is "Financial repression"?

    A)  It is a situation of High Inflation and Low real interest rates which deter the financial savings.

    B)  It is a situation in which the inflation shocks effectively reduce the value of outstanding debt.

    C)  It is a situation where a state is indirectly encouraging people to purchase gold, real estate and overseas assets.

    D)  It is a situation where a low and stable inflation rate helps maintain the value of the currency, both domestically and externally.

    Correct Answer: C

    Solution :

    [c] Financial repression signifies measures sometimes used by governments to boost their coffers and/or reduce debt. These measures include the deliberate attempt to hold down interest rates to below inflation, representing a tax on savers and a transfer of benefits from lenders to borrowers.

You need to login to perform this action.
You will be redirected in 3 sec spinner