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Question :

 Which one of the following is not a qualitative control of credit by the Central bank of a country?

Option 1:

Rationing of credit

Option 2:

Regulation of consumer credit

Option 3: Variation of margin requirements

 

Option 4: Regulation of margin requirements


Team Careers360 25th Jan, 2024
Answer (1)
Team Careers360 26th Jan, 2024

Correct Answer: Variation of margin requirements


Solution : The correct option is Variation of margin requirements.

Margin requirement adjustments are a quantitative control used by central banks. They involve specifying the amount an investor must deposit to buy securities on margin.This affects credit availability in financial markets. Qualitative controls focusses on directing credit by setting criteria for loans or adjusting lending terms.

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