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26. What is rationing of credit?
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Credit rationing is the limiting by lenders of the supply of additional credit to borrowers who demand funds at a set quoted rate by the financial institution. It is an example of market failure, as the price mechanism fails to bring about equilibrium in the market.
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Credit rationing is the limiting by lenders of the supply of additional credit to borrowers who demand funds at a set quoted rate by the financial institution. It is an example of market failure, as the price mechanism fails to bring about equilibrium in the market.
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