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Stealth • 5m

Are all currency notes just a pieces of paper.why dollar and INR don't have same value.why inflation are control by RBI.

2 replies2 likes

Replies (2)

Aryan patil
•

Monkey Ads • 5m

Imagine the RBI is like a big bank for other banks. Banks borrow money from the RBI to give loans to people and businesses. The interest rate the RBI charges banks is called the repo rate. Think of the repo rate as the price tag on borrowing money. When the RBI increases the price tag (raises the repo rate), borrowing from them becomes less attractive for banks. This means banks have less money to lend out, which reduces the overall amount of money circulating in the economy. Less money circulating typically means lower inflation. On the other hand, if the RBI lowers the repo rate, borrowing becomes cheaper for banks. This encourages them to borrow more from the RBI, which increases the money supply. More money floating around can lead to higher inflation. By adjusting the repo rate, the RBI can indirectly control inflation by influencing how much money banks lend out.

0 replies2 likes

Phanirockzzz

Stealth • 5m

If RBI did not control the inflation. People will. Then everyone makes supply or demand scarcity by which they can make a product cheaper or expensive by this things. After that everything becomes expensive. People working in every industry tries to cash that product by making its production less and by some year you will need to purchase in lakhs a kg chicken in market. Even an year or before. Sri Lanka went into this stage where they are selling kg chicken in thousands. When government does not regulate the prices. People will. And when people do things they do it for themselves not for country.

0 replies2 likes

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