Adequacy of foreign exchange reserves of a country is captured by which of the following indicators ...........

Indian Economic System External Sector

Adequacy of foreign exchange reserves of a country is captured by which of the following indicators ?

1. Reserves to import ratio

2. Reserves to external debt ratio

3. Reserves to GDP ratio

4. Reserves to monetary aggregates

Select the correct answer using the code below:

This questions was previously asked in

CAPF 2023 Paper-1

1 and 3 only

1, 2, 3 and 4

2, 3 and 4 only

1, 2 and 4 only

1, 2 and 4 only.

The reserves to import ratio, also known as the import ratio, is a ratio that compares a country's total foreign exchange (FX) reserves to its total imports.
The reserves to external debt ratio is a key indicator of a country's ability to use its reserve resources during a crisis. It shows how many dollars a country has in reserves for every dollar of debt it owes to a creditor.
Monetary Aggregates it includes the total supply of currency in circulation in addition to the stored portion of commercial bank reserves within the central bank.

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