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प्रश्न
What is credit creation?
उत्तर
Credit Creation means the multiplication of loans and advances. Commercial banks receive deposits from the public and use these deposits to give loans. However, loans offered are many times more than the deposits received by banks. This function of banks is known as ‘Credit Creation’.
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संबंधित प्रश्न
The ratio of total deposits that a commercial bank has to keep with Reserve Bank of India is
called:( choose the correct alternative)
(a) Statutory liquidity ratio
(b) Deposit ratio
(c) Cash reserve ratio
(d) Legal reserve ratio
A bank is an institution which deals in money and _____________
(commodity money/credit/barter/standard money)
Explain the agency function of commercial banks.
State whether the following statement is true or false :
Credit control is the function of commercial banks.
Write short note on :
Credit Creation.
State whether the following statements are True or False with reasons :
The interest is more on savings deposits.
Distinguish between:
Central Bank and Commercial Bank
Match the following:
| Group A | Group B |
| 1. D-mat account | a. Current account |
| 2. Over draft facility | b. Agency function |
| 3. ATM facility | c. Share brokers |
| 4. Commercial bank | d. General function |
| 5. Credit creation | e. Recurring account |
| f. Profit making | |
| g. Central bank | |
| h. Commercial bank |
Define explain the following concept.
Safe deposit vault
Distinguish between:
Call loans and long term loans
Write short note on:
E-banking facility
Bank credit refers to ______.
Which of the following points indicates that RBI is controlling the commercial banks?
______ is the total liability of the monetary authority of the country.
Consider the following statements:
- M1 is a broad concept of money.
- M2 is a narrow concept of money.
- M3 includes both M1 and lime deposit of public with the bank.
Which of the following is true with respect to the concept of supply of money?
Kalpana said that Commercial Bank is the controller of credit. Geeta said that the Central Bank is the controller of credit. Bobby said that both the commercial bank and the Central Bank are the controller of credit. Who among them is not correct?
Read the following hypothetical case study carefully and answer the questions follow on the basis of the same.
Agricultural Developmental Bank of Pakistan uses the production function approach for measuring bank outputs and costs. A translog cost function is estimated to provide an assessment of the bank's scale and scope efficiency, and to quantify the extent to which its production costs are sensitive to the size and output mix. Results show that the bank enjoys both overall and product-specific economies of scale and, therefore, there exists scope for the bank to expand its operations at a declining average cost. Even though bank branches in all size categories enjoy economies of scale, the extent of such economies is larger for branches operating at a smaller scale of production. This implies that as the bank branches grow larger in size in terms of both loan and deposit accounts, they move closer to attaining increasing returns to a factor. It is also shown that the marginal costs of servicing both loan and deposit accounts decline as bank branches grow larger in size in terms of either the number of loans or the number of deposits. This confirms that branches operating at a larger scale of production have attained greater cost-efficiency in terms of servicing the loan and deposit accounts.
The increasing returns to scale in larger branches is due to ______
Railways is an example of:
It takes Rohan 30 minutes to do an economics assignment and one hour to do a finance assignment. What is the opportunity cost of you doing two economics assignments?
