Which of the following pairs are correctly matched?
I. Increase in foreign exchange reserves Monetary expansio

Question

Which of the following pairs are correctly matched?
I. Increase in foreign exchange reserves Monetary expansion
II. Low import growth rate in India Recession in Indian Industry
III. Euro issues Shares held by Indian companies in European countries
IV. Portfolio investment Foreign institutional investors
Select the correct answer by using the following codes: Codes:

Accepted Answer

Explanation of why Option A is correct:

Statement I is correct because when foreign exchange reserves increase, the central bank buys foreign currency and releases equivalent domestic currency into the economy, leading to monetary expansion.

Statement II is correct because a significant portion of Indian imports consists of raw materials and capital goods. A low import growth rate often indicates sluggish manufacturing activity and low demand, which are signs of a recession in industry.

Statement III is incorrect because Euro issues refer to securities like Global Depository Receipts issued by Indian companies in the international market to raise foreign capital. They are not shares held by Indian companies in European countries.

Statement IV is correct because investments by Foreign Institutional Investors in the Indian stock market are a primary component of portfolio investment.

Since statements I, II, and IV are correct, Option A is the right answer.

Answer

I, II and IV

Answer

III and IV

Answer

I, II and III

Answer

I, II, III and IV

Explanation

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