Q.1.-10. In the following passage there are blanks each of which has been numbered. These numbers are printed below the passage and against each five words have been suggested, one of which fits the blanks appropriately. Find out the appropriate word in each case.
The International Monetary Fund’s decision to (1) China’s renminbi (RMB) in its currency unit, the special drawing right, or SDR, is an (2) of China’s economic heft: it accounts for 15% of global output. China was the world’ largest exporter, and second-largest importer, in 2014. To be in the SDR (3), a currency needs to also be “widely used” to make payments for international transactions and “widely traded” in the principal exchange markets. The yuan (4) on this count too, even if it is not freely convertible. But that’s a big minus. Capital controls will have to go before the yuan becomes a major global currency.
In 2014, China reportedly accounted for 1.1% of countries’ official reserve assets, and about 0.6% of international debt securities were denominated in yuan. Clearly, the international use of the yuan will (5) on the efforts of the Chinese central bank to ease (6) on cross-border flows. But that will have to be preceded by serious deepening and widening of China’s financial markets, which sadly trail the sophistication of its merchandise exports. The immediate (7) for China would be to have more of its trade settled in yuan, perhaps even before next October, when the yuan will officially be part of the SDR.
The rupee will, sooner or later, make its way to the SDR. As India (8) to register strong growth, even as the rest of the world either shrinks or marks time, its share in world output cannot but rise. (9) in the case of China, India’s financial sector is far more transparent. Sure, the country is nowhere close to full rupee convertibility, and there is no hurry either. What we need urgently is a fully developed financial market where it is possible to fully (10) against all three risks, of credit, interest rate and exchange rate.
Q.1. (1) exclude (2) include (3) remove (4) pursue (5) avail
Q.2. (1) inevitable (2) indictment (3) opposition (4) endorsement (5) accrual
Q.3. (1) basket (2) region (3) buffer (4) monitoring (5) limit
Q.4. (1) exemplifies (2) clarifies (3) qualifies (4) follow (5) fails
Q.5. (1) hinge (2) hooked (3) deny (4) quail (5) ponder
Q.6. (1) permission (2) shift (3) instructions (4) communication (5) restrictions
Q.7. (1) problem (2) gain (3) loss (4) action (5) solution
Q.8. (1) continues (2) obstructs (3) hints (4) qualified (5) maintain
Q.9. (1) like (2) similar (3) unlike (4) such (5) dissimilar
Q.10. (1) protective (2) conceal (3) avoid (4) hedge (5) block
Answers
Q.1. (2) include
Q.2. (4) endorsement
Q.3. (1) basket
Q.4. (3) qualifies
Q.5. (1) hinge
Q.6. (5) restrictions
Q.7. (2) gain
Q.8. (1) continues
Q.9. (3) unlike
Q.10. (4) hedge
