Explanation:

- Open Market Operations (OMO):

- The RBI buys or sells government securities in the open market to control the money supply. It can utilize this instrument.

- Cash Reserve Ratio (CRR):

- This is the percentage of a bank’s total deposits that must be kept in reserve. RBI uses this to regulate liquidity in the economy.

- Margin Requirement:

- This refers to the proportion of the loan value that borrowers must finance themselves. It controls the credit flow and is an available option for RBI.

- Deficit Financing:

- This involves funding government spending by borrowing, rather than using the central bank’s monetary tools.

- RBI cannot directly employ this as a monetary policy instrument.

Answer: Your Answer is Option 4 - Deficit Financing

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