If RBI infuses fresh money into circulation this will effect _______.
If RBI infuses fresh money into circulation this will effect _______.
The correct option is D Both
Money supply refers to the total stock of money of all types ( currency as well as demand deposits) held by the people of a country at a given point of time.
Money supply is measured in several ways which includes M1, M2, M3 and M4 measurement of money supply. Every measurement has it own definition with different components varying from most liquid to most rigid form.
If Reserve Bank of India(RBI) infuses fresh money into circulation, this will effect M1 and M2 measurement of money supply as they are considered the liquid money supply in the economy and includes currency held by public in terms of coins and paper notes and the demand deposits of the people with the commercial
banks.
Money supply refers to the total stock of money of all types ( currency as well as demand deposits) held by the people of a country at a given point of time.
Money supply is measured in several ways which includes M1, M2, M3 and M4 measurement of money supply. Every measurement has it own definition with different components varying from most liquid to most rigid form.
If Reserve Bank of India(RBI) infuses fresh money into circulation, this will effect M1 and M2 measurement of money supply as they are considered the liquid money supply in the economy and includes currency held by public in terms of coins and paper notes and the demand deposits of the people with the commercial banks.
