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The ratio of money held by the public in currency to that held as deposits in commercial banks is called .

Solution

Correct Option: 1

Currency Deposit Ratio (CDR) is defined as the ratio of money held by the public in currency form (C) to that held as deposits in commercial banks (DD), i.e., CDR=C/DDCDR = C/DD. CRR and SLR are mandatory reserves banks must keep, while high-powered money refers to currency plus bank reserves.

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