UPSC CSE Prelims
Question 80
The problem of international liquidity is related to the non-availability of
View correct answer and explanation
Correct answer: C
Correct Option: C
Explanation: International liquidity refers to reserves of widely accepted external payment assets, especially hard currencies such as the US dollar, used to settle international obligations.
Option-wise Analysis:
A: Incorrect - Scarcity of goods and services is a supply problem, not reserve-asset liquidity.
B: Incorrect - Gold may be a reserve asset, but a shortage of gold and silver alone does not define the modern liquidity problem.
C: Correct - A shortage of dollars and other convertible hard currencies restricts international payments.
D: Incorrect - Exportable surplus affects trade balances but is not the definition of international liquidity.