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Discussion

What happens when CRR is increased?

  • A.It decreases money supply
  • B.It increases demand for money
  • C.It decreases inflation
  • D.All of the above

Answer: D

When CRR is increased , it decreases money supply, Increases interest rates on home loans, car loans etc. and in inter-bank market, Increases demand for money and decreases inflation.

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