Question

What is Cash Reserve Ratio (CRR)?

Options

• The percentage of deposits that every bank must keep as cash reserves

• The percentage of deposits kept in liquid form in the short term

• Currency + Deposits

• The ratio of loans made by Bank to deposits

Answer 1

Cash Reserve Ratio (CRR) is the percentage of deposits that every bank must keep as cash reserves. It is a reserve requirement that limits the amount of credit a bank can create.