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The upper and lower tolerance limits around the inflation target are:
A5 and 3 percent
B7 and 1 percent
C6 and 2 percent
D8 and 4 percent
Answer & Solution
Correct answer: C. 6 and 2 percent
1. The target is 4 percent.
2. The band is 2 percentage points on each side.
3. So the limits are 6 and 2 percent.
_Source: Reserve Bank of India, Monetary Policy function overview (rbi.org.in)._
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