Open Market Operations in India

Open Market Operations (OMO) is a key monetary policy tool used by central banks. Option (a) is incorrect: borrowing by banks from RBI is separate from OMO. Option (b) is incorrect: this describes commercial banking operations, not central bank operations. Option (c) is correct: OMO specifically refers to the RBI's purchase and sale of government securities in the open market to regulate money supply and interest rates in the economy. This is a direct instrument of monetary policy used to control inflation and liquidity. > Open Market Operations = RBI buys/sells government securities to regulate money supply. Answer: (c).