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Open Market Operations refer to __________ .
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- Borrowings by Scheduled banks from RBI
- Lending by Commercial banks to industry
- Purchase and sale of Government securities by RBI
- Deposit mobilisation
- Borrowings by Scheduled banks from RBI
Correct Option: C
Open Market Operation (OMO) refers to the buying and selling of government securities in the open market in order to expand or contract the amount of money in the banking system. A central bank uses OMO as the primary means of implementing monetary policy.
