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ISRO EC 2023 Q.91: solution and answer

ISRO 2023 · ECQ.91 · 1 mark · MCQ

Statement: Exporters in the capital are alleging that commercial banks are violating a Reserve Bank of India directive to operate a post-shipment export credit denominated in foreign currency at international rates from January this year.

Courses of Action:
I. The officers concerned in the commercial banks are to be suspended.
II. The RBI should be asked to stop giving such directives to commercial banks.

(1 Mark)

  1. (A)

    Only I follow

  2. (B)

    Only II follows

  3. (C)

    Either I or II follows

  4. (D)

    Neither I nor II follows

See the question in the paper
ISRO EC 2023 question 91Tap to open full size

Answer and solution

ANSWER

Neither course of action follows, so the answer is (D).

Official answer: DSource: ISRO's revised and final answer key of 16 February 2024

  1. The statement only reports an allegation by exporters that commercial banks are not following an RBI directive on post-shipment export credit in foreign currency. The allegation has not been verified.

  2. Course I (suspend the officers): acting against individuals on an unproven allegation is premature and drastic. The first step would be to inquire whether the directive was actually violated. So I does not follow.

  3. Course II (ask the RBI to stop giving such directives): the RBI is the regulator and issuing directives is its function. The complaint is that banks are not complying, not that the directive is wrong. Withdrawing the directive does not address the problem. So II does not follow.

  4. The two courses are not alternatives to each other. Each fails on its own, so 'Either I or II follows' is also wrong.

  5. Neither I nor II follows, which is option (D).

KEY IDEA

A course of action must be a sensible, proportionate response to the problem in the statement. An unverified allegation calls for an inquiry, not punishment, and the regulator's directive is not the thing at fault.

WATCH OUT FOR

Treating the allegation as established fact and picking the harsh action (suspension), or reading the complaint as a fault in the RBI's directive instead of non-compliance by banks.

From the ISRO EC 2023 paper. Also Q.91 of the ISRO Scientist/Engineer Computer Science 2023 paper. Every question of this paper · The full paper (PDF, ISRO) · All 11 ISRO Reasoning questions, with notes

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