Match the items of List – I with those of List – II with regard to International Monetary Fund : List –…
In the IMF's lending framework: Stand-By Arrangements (SBA) are the most commonly used facility to address short-term Balance of Payments difficulties (iv); the Poverty…
Choose your answer
Match the items of List – I with those of List – II with regard to International Monetary Fund :
List – I
List – II
a. Stand-by Arrangement
i. Enhanced Structural Adjustment Facility (ESAF) was replaced by this scheme.
b. Poverty Reduction and Growth Facility (PRGF)
ii. Exceptional balance of payments problems arising from a sudden loss of confidence in the currency.
c. Supplemented Reserve Facility (SRF)
iii. Financial crisis causing capital outflow on capital account of balance of payments.
d. Contingent Credit Line (CCL)
iv. To meet balance of payments difficulties (most commonly used facility).
Answer and explanation
Correct answer B
In the IMF's lending framework: Stand-By Arrangements (SBA) are the most commonly used facility to address short-term Balance of Payments difficulties (iv); the Poverty Reduction and Growth Facility (PRGF) replaced the Enhanced Structural Adjustment Facility (ESAF) in 1999 (i); the Supplemental Reserve Facility (SRF) addresses exceptional BOP difficulties caused by a sudden loss of market confidence (ii); and Contingent Credit Lines (CCL) were designed as a precautionary defence against financial contagion and capital account outflows (iii).
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UGC NET Commerce