Money Creation by Banking System

How does change in margin requirements help in controlling credit?

What is Repo Rate, Reverse Repo Rate and Bank Rate Policy? How do they work as methods of credit control?

Explain the Controller of Money Supply and Credit function of a central bank?

The Government of India has recently launched 'Jan Dhan Yojana' aimed at every household in the country to have at least one bank account. Explain how deposits made under the plan are going to affect the national income of the country.

Define Credit Multiplier. What role does it play in determining the credit creation power of the banking system? Use a numerical illustration to explain.

Elaborate any two instruments of Credit Control, as exercised by the Reserve Bank of India.

To reduce credit availability in the economy, the Central Bank may_____.

Explain how 'margin requirements' are helpful in controlling credit creation.

Explain how 'bank rate' is helpful in controlling credit creation.

State, whether the following statement is true or false:

'Margin requirement is raised by the Central Bank to increase money supply.'

Credit creation by commercial banks is determined by:

Explain the role of reverse repo rate in controlling money supply.

Explain how 'open market operations' are helpful in controlling credit creation.

 What do you call the ratio of total deposits that a commercial bank has to keep with the Reserve Bank of India?

Describe any two methods by which Reserve Bank of India can regulate money supply?

How is 'bank rate' used by central bank in influencing credit creation by commercial banks? Explain.

OR

How do changes in Bank Rate affect money supply in an economy? Explain.
 

How does a central bank influence credit creation by commercial banks through 'open market operations'? Explain.

What is meant by margin requirement? How can it be used to control the money supply? Explain it with the help of an example.

Explain the process of money creation by the commercial banks with the help of a numerical example.

"To boost the falling demand in the economy, the Reserve Bank of India recently reduced Repo rate."

Elaborate the rationale behind the steps taken by the Central Bank.