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प्रश्न
Explain how 'margin requirements' are helpful in controlling credit creation?
उत्तर
Margin requirement is the difference between the current value of the security given for a loan and the value of loan granted. For example, mortgaging land for Rs 100 lakh with the bank for a loan of Rs 75 lakh. So, the margin requirement would be Rs 25 lakh. Therefore, to control deflation, the central bank reduces the margin money requirement which induces borrowers to avail more loans from commercial banks.
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संबंधित प्रश्न
Explain how open market operations are helpful in controlling credit creation.
Explain how ‘bank rate' is helpful in controlling credit creation?
Explain with reasons, whether you agree or disagree with the following statement
Cash reserve ratio is a quantitative measure of credit control.
Central Bank has the sole power of issuing currency notes.
Define or explain the following concepts.
Clearing house
Match the following Group ‘A’ with Group ‘B’ :
|
Group ‘A’ |
Group ‘B’ |
||
| (a) |
Economics | (1) | not steady |
| (b) |
Reward of capital | (2) | 1 April, 1935 |
| (c) |
Value of money | (3) | Social science |
| (d) |
Establishment of Central Bank | (4) | Income from commodity tax |
| (e) | Sales tax | (5) | Natural science |
| (6) | Interest |
||
| (7) | 1 April, 1939 | ||
State whether the following statements are True or False with reason:
Due to clearing house of the Central Bank cash money is saved.
State whether the following statement is TRUE or FALSE.
Credit rationing is quantitative credit control measure of Central bank.
State whether the following statement is TRUE or FALSE.
Regulation of Consumer Credit is a quantitative credit control measure of Central Bank.
Give reason or explain.
Clearing house system economises the use of cash.
Distinguish between:
Quantitative Credit Control Measures and Qualitative Credit Control Measures
Write short note on:
Issuing Directives
Answer the following question:
What are the various measures of quantitative credit control?
Answer the following question:
What are the various measures of qualitative credit control?
Differentiate between Cash Credit and Outright Loans.
