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Mention any two ways the deflation can change by qualitative methods of credit control.

Asked by Topperlearning User 21st April 2015, 10:31 AM
Answered by Expert

To control the deflation, the central bank follows the following two qualitative credit control measures:

  1. Reduction of margin money requirements is a measure which induces borrowers to avail more loans from the commercial banks.
  2. Relaxation in credit authorisation is a measure where the central bank can reduce the ceiling on the amount of credit to be disbursed by the commercial bank for certain purposes.
Answered by Expert 21st April 2015, 12:31 PM
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