what is credit multiplier?

Credit multiplier is the resiprocal of Cash Reserve Ratio.

                            Credit Multiplier = 1 / CRR

                                              OR

                            Credit Muliplier = Demand deposits / Cash reserves

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reciprocal !!! :)

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yea..jaspreet...typng mistk.. :)

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Plastic money usage problem faced by a consumer?
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Credit multiplier is the number of times a commercial bank can create credit per unit of their cash reserves with RBI.
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Ffhjko
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gttggthyh
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What?????
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In monetary economics, a money multiplier is one of various closely related ratios of commercial bank money to central bank money under a fractional-reserve banking system. It relates to the maximum amount of commercial bank money that can be created, given a certain amount of central bank money.
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Credit multiplier measures the amount of money that the banks are able to create in the form of deposits with every initial deposit. Example: The process of money creation can be explained by taking an example of a bank.
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A credit multiplier measures the amount of money that the banks can create in the form of deposits with every initial deposit. The credit creation by commercial banks depends on a credit multiplier as it is inversely related to LRR.
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