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What do you mean by credit creation by commercial banks?
- a)It is the process of total withdrawal creation
- b)It is the process of total deposit creation
- c)It is the process of loan creation
- d)It is the process of creation of foreign exchange
Correct answer is option 'B'. Can you explain this answer?
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What do you mean by credit creation by commercial banks?a)It is the pr...
Credit creation is the most significant function of the commercial banks. Commercial banks accept deposits and lend loans and advances. In this process they create two types of deposits, namely primary deposits and derivative or active deposits. The former refers to the cash deposited by a customer in a bank or deposit a cheque with the bank for collection. The banker merely accepts cash am converts it into a deposit. Hence, this is merely a passive role performed by the banks. These primary deposits do not add to the money stock in the economy. From their experience and observation the banks know that not all the customers will withdraw their deposits on any single day. Hence, after providing for some reserve to meet the cash requirement of the depositors, the banks lend the balance to the borrow. The amount of reserve to be maintained by the banks is Cash Reserve Ratio which is determined by the central bank.
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What do you mean by credit creation by commercial banks?a)It is the pr...
CREDIT CREATION By COMMERCIAL BANKS.
... The CREATION of CREDIT or deposits is one of the most vital operations of the COMMERCIAL BANKS.
... Similar to other corporations, banks aim at earnings profits.
....For this intention, they accept cash in demand deposits and advance loans on credit to customers.
... The CREATION of CREDIT or deposits is one of the most vital operations of the COMMERCIAL BANKS.
... Similar to other corporations, banks aim at earnings profits.
....For this intention, they accept cash in demand deposits and advance loans on credit to customers.
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What do you mean by credit creation by commercial banks?a)It is the pr...
C is the answer
because the commercial banks are giving or providing to us
because the commercial banks are giving or providing to us
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What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer?
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What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer?.
What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What do you mean by credit creation by commercial banks?a)It is the process of total withdrawal creationb)It is the process of total deposit creationc)It is the process of loan creationd)It is the process of creation of foreign exchangeCorrect answer is option 'B'. Can you explain this answer?.
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