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प्रश्न
The Central Bank can reduce the Money Supply in economy by ______ the ______.
पर्याय
increasing, bank rate
decreasing, cash reserve ratio
decreasing, bank rate
buying, government securities
MCQ
रिकाम्या जागा भरा
उत्तर
The Central Bank can reduce the Money Supply in economy by increasing the bank rate.
Explanation:
- The central bank can restrict the money supply by increasing the bank rates in the economy.
- The bank rate is the rate at which the central bank loans money to commercial banks for an extended period of time.
- When bank rates rise, journal public interest rates rise as well, reducing commercial banks' lending capacity and causing a drop in the economy's money supply.
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