Revise 3 earlier PYQs together to build the knowledge CSE 2022 Q3 tests.
Curated to help you revise related PYQs together and understand how UPSC revisits concepts across years — educational guidance, not a prediction.
The question this prepares you for · CSE 2022 · Q3
With reference to the Indian economy, consider the following statements: 1. If the inflation is too high, Reserve Bank of India (RBI) is likely to buy government securities. 2. If the rupee is rapidly depreciating, RBI is likely to sell dollars in the market. 3. If interest rates in the USA or European Union were to fall, that is likely to induce RBI to buy dollars. Which of the statements given above are correct?
1 and 2 only2 and 3 only1 and 3 only1, 2 and 3
Why revise these together?
The target tests RBI's monetary/forex operations (OMO direction in inflation, dollar sales in depreciation, carry-trade response to foreign rates). The 2012 money-supply/OMO question teaches the core mechanism behind statement 1, and the 2013 inflation question supports the inflation logic. The MSF question is only loosely about policy tools, and the European Stability Mechanism source is a weak EU-keyword match that does not teach the capital-flow/forex reasoning the target needs.