Cash Reserve Ratio (CRR) Online Test

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Cash Reserve Ratio (CRR)

Description: Cash Reserve Ratio (CRR) Quiz
Number of Questions: 15
Created by: Aliensbrain Bot
Tags: crr rbi monetary policy indian economics

What is the primary objective of the Cash Reserve Ratio (CRR)?

To control inflation
To maintain financial stability
To regulate the money supply
To promote economic growth

What is the current CRR in India?

3%
4%
5%
6%

Which authority is responsible for setting the CRR in India?

Reserve Bank of India (RBI)
Ministry of Finance
Planning Commission
National Bank for Agriculture and Rural Development (NABARD)

How does the CRR affect the money supply?

It increases the money supply
It decreases the money supply
It has no effect on the money supply
It depends on the economic conditions

What is the impact of a higher CRR on the economy?

It leads to higher inflation
It leads to lower inflation
It has no impact on inflation
It depends on the economic conditions

What is the impact of a lower CRR on the economy?

It leads to higher inflation
It leads to lower inflation
It has no impact on inflation
It depends on the economic conditions

How does the CRR affect the interest rates?

It increases interest rates
It decreases interest rates
It has no impact on interest rates
It depends on the economic conditions

What is the impact of a higher CRR on economic growth?

It promotes economic growth
It hinders economic growth
It has no impact on economic growth
It depends on the economic conditions

What is the impact of a lower CRR on economic growth?

It promotes economic growth
It hinders economic growth
It has no impact on economic growth
It depends on the economic conditions

What are the other tools of monetary policy used by the RBI?

Repo rate
Reverse repo rate
Open market operations
Marginal standing facility

How does the CRR affect the profitability of banks?

It increases bank profitability
It decreases bank profitability
It has no impact on bank profitability
It depends on the economic conditions

How does the CRR affect the demand for credit?

It increases the demand for credit
It decreases the demand for credit
It has no impact on the demand for credit
It depends on the economic conditions

How does the CRR affect the foreign exchange reserves?

It increases foreign exchange reserves
It decreases foreign exchange reserves
It has no impact on foreign exchange reserves
It depends on the economic conditions

What is the relationship between the CRR and the SLR?

CRR is a component of SLR
SLR is a component of CRR
CRR and SLR are independent of each other
CRR and SLR are inversely related

What is the impact of the CRR on the government's fiscal deficit?

It increases the fiscal deficit
It decreases the fiscal deficit
It has no impact on the fiscal deficit
It depends on the economic conditions

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