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Suppose that 30000 crore in new reserves is deposited in the Indian banking system as a result of Reserve Bank relaxing reserve requirements. If the
Suppose that 30000 crore in new reserves is deposited in the Indian banking system as a result of Reserve Bank relaxing reserve requirements. If the current reserve requirement (CRR+SLR) is 23 percent and public place another 7 percent of incoming funds into their wallets, what is the size of the banking system deposit multiplier? How much in new money creation by the system will occur as result of the injection of 30000 crore in new reserves
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