As per section ________ of the Reserve Bank of India Act, 1934, the bank is allowed to has full authority to issue notes.
Show answer & explanation
Correct answer: B
Explanation
The correct answer is Option 2 i.e. 22
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Preamble to the RBI Act, 1934 spells out the objectives of the RBI as:
(a)To regulate the issue of bank notes.
(b)To keep reserves with a view to securing monetary stability in India.
(c)To operate currency and credit system of the country to its advantage.
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Management of currency is one of the core central banking functions of the RBI for which it derives the necessary statutory powers from Section 22 of the RBI Act, 1934.
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Right to issue bank notes [Section 22]: The RBI shall have the sole right to issue ‘bank notes’ in India.