If the Cash Reserve Ratio is lowered by the RBI, supply of money in the economy will :

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Q: 83 (CAPF/2023)
If the Cash Reserve Ratio is lowered by the
RBI, supply of money in the economy will :

question_subject: 

Economics

question_exam: 

CAPF

Lowering the Cash Reserve Ratio (CRR) by the RBI increases the amount of liquid funds available with banks. This, in turn, increases the money supply in the economy as banks have more funds to lend, which can stimulate economic activity.