Question

Given LRR = 40% how much will be the credit creation if there are new deposits of ₹900
million in commercial
banks?​

Answer 1

Answer:

What is the value of money multiplier when initial deposits are Rs 500 crores and LRR is 10 %?

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.

Explanation:

i think it will really help you