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प्रश्न
State the impact of an increase in Cash Reserve Ratio on loanable funds.
What is the impact of an increase in Cash Reserve Ratio on loanable funds?
संक्षेप में उत्तर
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उत्तर
- An increase in the Cash Reserve Ratio (CRR) requires commercial banks to maintain a higher portion of their deposits as reserves with the Reserve Bank of India.
- This reduces the amount of money available to banks for lending, resulting in a fall in total loanable funds.
- As a result, bank's ability to lend to consumers and businesses decreases, thereby slowing economic activity.
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Monetary Policy of the Central Bank
क्या इस प्रश्न या उत्तर में कोई त्रुटि है?
संबंधित प्रश्न
During deflation, the Central Bank usually ______.
The central bank controls credit _____ .
In order to encourage investment in the economy, the central bank may ______.
Define the term Statutory Liquidity Ratio.
Differentiate between quantitative and qualitative methods of credit control.
Define the following term:
Margin Requirements.
Which of the following statements are correct and which are incorrect? Give reasons.
- Central bank is a currency authority.
- Bank rate is a qualitative method of credit control.
- Quantitative methods regulate direction of credit.
- Bank rate is the rate at which commercial banks give loans to the public.
- Central bank should sell government securities when credit is to be expanded.
Who controls the credit supply in an economy?
What do you mean by credit control?
Describe two quantitative credit control measures of the Central Bank.
