Question

09. How Taxes are used by the government to correct Deficient demand
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Answer 1

To correct the deficient demand, the central bank decreases CRR or/and SLR. It increases the amount of effective cash resources of commercial banks and enhances their credit creating power. It will raise the level of borrowings and helps to minimise the deficiency in demand.

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Answer 2

Answer:

To correct the deficient demand, the central bank decreases CRR or/and SLR. It increases the amount of effective cash resources of commercial banks and enhances their credit creating power. It will raise the level of borrowings and helps to minimise the deficiency in demand.

Explanation:

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