Q. Consider the following statements regarding “cash reserve ratio (CRR)”:
1.It is fixed by the central government.
2.It is the ratio of the total deposits of a bank in India which is kept with the RBI in the form of gold.
Which of the statements given above is/are not correct?
Answer: C
Notes:
Explanation: The cash reserve ratio (CRR) is the ratio (fixed by the RBI) of the total deposits of a bank in India which is kept with the RBI in the form of cash.
- This was fixed to be in the range of 3 to 15 per cent.
- A recent Amendment (2007) has removed the 3 per cent floor and provided a free hand to the RBI in fixing the CRR.
Source: Ramesh Singh
