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Which of the following statements is/are correct regarding the Monetary Policy Committee?
1. It decides the RBI's benchmark interest rates.
2. It is a 12 member body including the Governor of RBI and is reconstituted every year.
3. It function under the Chairmanship of the Union Finance Minister.

Select the correct answer using the codes given below.
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 2 and 3 only



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Statement 1 is correct. The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) is responsible for deciding the RBI's benchmark interest rates, including MSF, Repo Rate, Reverse Repo Rate, and Liquidity Adjustment Facility.

Statement 2 is incorrect. The MPC consists of six members, including three members nominated by the government and three members from the RBI. The committee members are appointed for a fixed term of four years and are not eligible for reappointment.

Statement 3 is incorrect. The Governor of the RBI is the ex-officio Chairperson of the MPC, not the Union Finance Minister.


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