SDR - GS questions based on daily current affairs

1)   Which of the following statements is/are correct about XDR/SDR?

1. Asian Development bank use it as a Unit of account
2. Chinese RMB is a part of SDR basket.

a. Only 1
b. Only 2
c. Both
d. None
Answer  Explanation 

ANSWER: Only 2

Explanation:
- Special drawing rights (XDR or SDR) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF).
- Their value is based on a basket of key international currencies reviewed by IMF every five years.
- Based on the latest review conducted on December 30, 2010, the XDR basket consists of the following four currencies: U.S. dollars ($), euro (€), pounds sterling (£), and Japanese yen (¥): 9.4 percent (compared with 11 percent at the 2005 review).
- The weights assigned to each currency in the XDR basket are adjusted to take into account their current prominence in terms of international trade and national foreign exchange reserves.
2)   Which of the following currency/currencies is/are part of Special drawing rights (XDR or SDR)?

1. Japanese yen
2. Russian Ruble
3. Chinese Yuan
4. Euro
5. Pounds sterling

a. 1,4,5
b. 1,2,4,5
c. 4 and 5
d. All
Answer  Explanation 

ANSWER: 1,4,5

Explanation:
- Special drawing rights (XDR or SDR) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF).
- Their value is based on a basket of key international currencies reviewed by IMF every five years.
- Based on the latest review conducted on December 30, 2010, the XDR basket consists of the following four currencies: U.S. dollars ($), euro (€), pounds sterling (£), and Japanese yen (¥): 9.4 percent (compared with 11 percent at the 2005 review).
- The weights assigned to each currency in the XDR basket are adjusted to take into account their current prominence in terms of international trade and national foreign exchange reserves.

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