Question

______ is concerned with maintaining the minimum reserve of assets with RBI, whereas the cash reserve ratio is concerned with maintaining cash balance (reserve) with RBI.

पर्याय

• CRR

• SLR

• Repo rate

• None of the above

Answer 1

SLR  is concerned with maintaining the minimum reserve of assets with RBI, whereas the cash reserve ratio is concerned with maintaining cash balance (reserve) with RBI.

Explanation:

Statuary Liquidity Ratio (SLR)
The SLR is concerned with keeping a minimum amount of assets in reserve with the RBI, whereas the cash reserve ratio is concerned with keeping a cash balance (reserve) with the RBI. SLR is defined as the minimum percentage of assets that must be kept in the form of fixed or liquid assets with the RBI. By boosting the liquidity ratio, the flow of credit is lowered, and vice versa. In the previous example, an increase in SLR will make it more difficult for banks to inject money into the economy, resulting in a fall in the money supply. When SLR falls, it increases the money supply in the economy, which is the opposite of what happens when it rises.