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Suppose in an economy, the initial deposits of ₹ 400 crores lead to the creation of total deposits worth ₹ 4000 crores.Under the given situation the value of reserve requirements would -

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Question

Suppose in an economy, the initial deposits of ₹ 400 crores lead to the creation of total deposits worth ₹ 4000 crores.
Under the given situation the value of reserve requirements would be ____________.

Options

  • 0.01

  • 1

  • 0.1

  • 0.4

MCQ
Fill in the Blanks

Solution

Under the given situation the value of reserve requirements would be 0.1.

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Investment Multiplier and Its Mechanism
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