Question : Statement 1: Institutional sources of credit offer flexible repayment schedules to accommodate farmers' cash flows.
Statement 2: Institutional sources of credit require farmers to provide collateral for loan approval.
Option 1: Both statement 1 and statement 2 are true.
Option 2: Both statement 1 and statement 2 are false.
Option 3: Statement 1 is true, but statement 2 is false.
Option 4: Statement 1 is false, but statement 2 is true.
Correct Answer: Statement 1 is true, but statement 2 is false.
Solution : I apologize for the confusion. Let me correct my previous response.
The correct answer is (c) Statement 1 is true, but statement 2 is false.
Institutional sources of credit do offer flexible repayment schedules to accommodate farmers' cash flows. They understand the seasonal nature of agriculture and may provide repayment options that align with the farmers' income patterns.
However, not all institutional sources of credit require collateral for loan approval. Some institutions may require collateral, while others may offer loans based on the farmers' creditworthiness, repayment history, or other factors. The requirement for collateral can vary depending on the specific institution and the type and size of the loan being sought. Therefore, statement 2 is not universally true for all institutional sources of credit.
Question : Statement 1: Institutional sources of credit provide farmers with flexible repayment options.
Statement 2: Institutional sources of credit offer longer loan tenure compared to informal sources.
Question : Statement 1: Institutional sources of credit offer lower interest rates compared to informal sources.
Statement 2: Institutional sources of credit provide farmers with financial counseling and guidance.
Question : Statement 1: Institutional sources of credit provide farmers with timely access to credit facilities.
Statement 2: Institutional sources of credit have simplified loan application procedures.
Question : Statement 1: Institutional sources of credit include banks, cooperatives, and government programs.
Statement 2: These institutions provide credit to farmers at high-interest rates.
Question : Statement 1: Diversification of agricultural activities can improve the overall income of farmers.
Statement 2: Diversification allows farmers to explore additional sources of income.
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