Money and Banking-Money Creation (CBSE (Central Board of Secondary Education- Board Exam) Class-12 Economics): Questions 1 - 5 of 5

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Question number: 1

» Money and Banking » Money Creation

One Liner Question▾

Write in Brief

State the two components of money supply.

Question number: 2

» Money and Banking » Money Creation

One Liner Question▾

Write in Brief

If planned savings are greater than planned investment, what will be its effect on inventories?

Question number: 3

» Money and Banking » Money Creation

Essay Question▾

Describe in Detail

Explain the process of money creation by commercial banks.

Explanation

Money creation (or deposit creation or credit creation) by the banks is determined by

(1) the amount of the initial fresh deposits and

(2) the Legal Reserve Ratio (LRR),

the minimum ratio of deposit legally required to be kept as cash by the banks. It is assumed that all the… (159 more words) …

Question number: 4

» Money and Banking » Money Creation

One Liner Question▾

Write in Brief

What will be the effect of a rise in bank rate on money supply?

Question number: 5

» Money and Banking » Money Creation

Essay Question▾

Describe in Detail

Explain the evolution of money.

Explanation

Stages for evolution of money:

(i) Commodity for Commodity: Commodity for Commodity is also known as Barter system in which goods were exchanged for goods and services were exchanged for services when there was not any other source of exchange in the economy known. But this system lead to the… (84 more words) …

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