Reserve arithmetic

Exercise and reference answers

Questions

1. Answer

   20

   Question

   CRR is 20 per cent and deposits are Rs 100. Cash reserves needed, in rupees?

2. Answer

   5

   Question

   Reserves of Rs 100 support money supply of Rs 500. What is the money multiplier?

3. Answer

   80

   Question

   Deposits Rs 100, CRR 20 per cent. How many rupees can the bank lend out?

Instructions

Work it out, key the number in, then press enter.

Explanation