Multiple choice

Directions: Choose the correct word for blank (2).

If India wants to ___ (1) ___ the rupee and keep her capital account open, the use of monetary policy to ___ (2) ___ growth by increasing money supply and reducing interest rates will have to be sacrificed. If she wants to have a stable rupee and use monetary policy to ___ (3) ___ growth, these can be accomplished through capital controls. If she prefers an open capital account and a strong monetary policy, the rupee will remain ___ (4) __. Pessimism regarding its downward slide is __ (5) ___.

  1. trigger

  2. impel

  3. innervate

  4. stimulate

  5. enervate

Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Correct; the word means 'encourage an activity'. We have to encourage growth by various ways.