48th to 52nd B.P.S.C. (Pre) 2008
If the Cash Reserve Ratio is lowered by the RBI, its impact on credit creation will be :
aIncrease✓ Correct
bDecrease
cNo impact
dNone of the above
Explanation
If the Reserve Bank of India reduces the Cash Reserve Ratio (CRR), the amount of credit creation by commercial banks increases.
economic-social-development
