CBSE Class 12-commerce Answered
What is meant by credit creation?
Asked by Topperlearning User | 18 Apr, 2016, 10:57: AM
Expert Answer
Credit creation refers to the creation of demand deposits with the commercial banks on the basis of their cash reserves. The deposits are created more than the cash reserves. According to the historical experience of the banks, the cash withdrawal of funds is only a small portion of total demand deposits.
Answered by | 18 Apr, 2016, 12:57: PM
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