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| Q. |
The smaller the Cash Reserve Ratio, the scope for lending by banks is : |
| A. | greater |
| B. | smaller |
| C. | weaker |
| D. | lesser |
| Answer» A. greater | |
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Explanation: Cash Reserve Ratio is a regulation set by Central bank (RBI in India) which dictates the minimum amount (reserves) (hata commercial bank must be held to customer notes and deposits. A decrease in CRR will make it mandatory for the banks to hold a lesser proportion of (heir deposits in the form of deposits with the RBI. |
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