To finance its deficit government prefers borrowing from public over REI. What can be the best reason for this?
A. Rate of interest charred by RBI is higher
B. Government has to return the sum to RBI within a fixed period of time
C. Public borrowing does not affect the money supply in the market
D. It increases the sale of government bonds
Answer:C
To finance its deficit government prefers borrowing from public over REI. What can be the best reason for this?
A. Rate of interest charred by RBI is higher B. Government has to return the sum to RBI within a fixed period of time C. Public borrowing does not affect the money supply in the market D. It increases the sale of government bonds