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The Central Bank & Monetary Policy · Question 27 of 58

Question 27

MediumOriginal question

Banks in a country have deposits of ₹10,000 crore. If the CRR is raised from 4% to 4.5%, the funds they must lock up with the central bank rise by

Options for question 27

Show the answer and explanation
CorrectNot quiteAnswer B

Correct answer: B

Explanation

  1. Extra reserves = 0.5% of 10,000 = ₹50 crore.

Worth noting

₹450 crore is the whole new requirement, not the rise.

Concept
A change in CRR
Typical time
70 s
Your time
—
The rule this testsCRR and SLR
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