Discussion Forum : Nabard & Other Bank Examinations
Question -
What happens when CRR is increased?
Answer: Option D
WHEN CRR IS INCREASED , IT DECREASES MONEY SUPPLY, INCREASES INTEREST RATES ON HOME LOANS, CAR LOANS ETC. AND IN INTER-BANK MARKET, INCREASES DEMAND FOR MONEY AND DECREASES INFLATION.
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WHEN CRR IS INCREASED , IT DECREASES MONEY SUPPLY, INCREASES INTEREST RATES ON HOME LOANS, CAR LOANS ETC. AND IN INTER-BANK MARKET, INCREASES DEMAND FOR MONEY AND DECREASES INFLATION.
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