Drishti IAS - English (Information & Motivation)
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Drishti IAS - English (Information & Motivation)
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The correct answer is option (A).
"Statements 1 and 2 are correct. Hence option A is correct.
Statement 3 is incorrect. MCLR is considered better in all respects because rates based on this system are more receptive to the changes in the policy rate. Any change in the Repo Rate is reflected almost immediately. This also ensures that the country’s monetary policy is implemented effectively across all spheres. "