High Order Thinking Skills Questions - Money and Banking

# High Order Thinking Skills Questions - Money and Banking Notes | Study Economics Class 12 - Commerce

## Document Description: High Order Thinking Skills Questions - Money and Banking for Commerce 2022 is part of Money and Banking for Economics Class 12 preparation. The notes and questions for High Order Thinking Skills Questions - Money and Banking have been prepared according to the Commerce exam syllabus. Information about High Order Thinking Skills Questions - Money and Banking covers topics like and High Order Thinking Skills Questions - Money and Banking Example, for Commerce 2022 Exam. Find important definitions, questions, notes, meanings, examples, exercises and tests below for High Order Thinking Skills Questions - Money and Banking.

Introduction of High Order Thinking Skills Questions - Money and Banking in English is available as part of our Economics Class 12 for Commerce & High Order Thinking Skills Questions - Money and Banking in Hindi for Economics Class 12 course. Download more important topics related with Money and Banking, notes, lectures and mock test series for Commerce Exam by signing up for free. Commerce: High Order Thinking Skills Questions - Money and Banking Notes | Study Economics Class 12 - Commerce
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Q.1 Calculate the value money multiplier and the total deposit created if initial deposit is of Rs. 500 crores and LRR is 10%.

Ans:  Money multiplier = 1/LRR which is equal to 1/0.1=10

Initial deposit Rs. 500 crores

Total deposit = Initial deposit x money multiplier

= 500 x 10 = 5000 crores.

Q.2 If total deposits created by commercial banks are Rs.12000, LRR is 25% calculate initial deposit.

Ans:  Money multiplier = 1/LRR = 1/.25 = 4

Initial deposit = Total deposit / money multiplier = 12000/4  = 3000

Q.3 Calculate LRR, if initial deposit of Rs. 200 cores lead to creation of total deposits of Rs. 1600 cores.

Ans:  Money multiplier = Total deposits/Initial deposits = 1600/200=8

Money multiplier = 1/LRR = 8=1/LRR.

LRR = 1.25 or 12.5

The document High Order Thinking Skills Questions - Money and Banking Notes | Study Economics Class 12 - Commerce is a part of the Commerce Course Economics Class 12.
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## Economics Class 12

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## Economics Class 12

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