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45.
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Statement: Should there be only one
rate of interest for term deposits of varying durations in banks?
Arguments:
I.
No.
People will refrain from keeping money for longer duration resulting into
reduction of liquidity level of banks.
II.
Yes.
This will be much simple for the common people and they may be encouraged to
keep more money in banks.
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A.
|
Only argument I is
strong
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B.
|
Only argument II is
strong
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C.
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Either I or II is
strong
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D.
|
Neither I nor II is
strong
|
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E.
|
Both I and II are
strong
|
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Answer: Option A
Explanation:
Clearly, the proposed scheme would discourage
people from keeping deposits for longer durations (the rate of interest being
the same for short durations) and not draw in more funds. So, only argument I
holds.
