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प्रश्न
Explain the role of Cash Reserve Ratio in removing an inflationary gap
उत्तर
Cash Reserve Ratio (CRR) is the necessary minimum percentage of a bank’s total deposits which is to be kept with the Central Bank. Commercial banks need to maintain with the Central Bank a certain percentage of their deposits in the form of cash reserves. The Central Bank can vary CRR between 3% and 15%. When a bank holds a large portion of deposits as CRR, it reduces the provision of credits to the public. This leads to a decline in the demand for loans and consumption expenditure. Thus, the aggregate demand reduces and the economy attains equilibrium.
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संबंधित प्रश्न
Explain national income equilibrium through aggregate demand and aggregate supply. Use diagram. Also explain the changes that take place in an economy when the economy is not in equilibrium
Explain the role of 'Margin Requirements' in removing this deficient demand gap.
Explain the following concepts or give definitions.
Depreciation
State whether the following statements are True or False with reason:
Income earned from foreign investment is considered for aggregate demand.
Fill in the blank with appropriate alternatives given below
The General Theory of Employment, Interest and Money was written by __________.
Fill in the blank with appropriate alternatives given below
That part of income, which is not spent on consumption, is called __________.
Match the following Group:
| Group A | Group B | ||
| 1) | Aggregate Supply | a) | Expected receipts |
| 2) | Autonomous Investment | b) | Lord J. M. Keynes |
| 3) | Consumption | c) | Government Investment |
| 4) | A.P.C. | d) | ΔC/ΔY |
| 5) | Investment | e) | C/Y |
| f) | Addition to stock of capital | ||
| g) | Destruction of utility | ||
Define or Explain the following concept:
Aggregate Demand
Write Short note on:
Average Propensity to Consume
State with reason whether you agree or disagree with the following statement.
Aggregate supply is influenced by the state of technology only.
Answer in detail.
What is Aggregate Supply? Explain the determinants of Aggregate Supply.
Write explanatory answer.
What is 'aggregate supply'? Explain the determinants of aggregate supply.
Choose the correct from given options
When aggregate demand is greater than aggregate supply, inventories
The main component of aggregate demand is ______
What is meant by Equilibrium income?
What is the circumstance when aggregate output is determined solely by the level of aggregate demand called?
When aggregate demand is greater than aggregate supply, inventories:
Why is effective demand also known as expost demand?
With the help of a diagram, determine the equilibrium level of output and income by using Aggregate demand and aggregate supply approach.
