Best answer: Who is the supplier of money in India?

The Reserve Bank of India (RBI) prints and manages currency in India, whereas the Indian government regulates what denominations to circulate. The Indian government is solely responsible for minting coins. The RBI is permitted to print currency up to 10,000 rupee notes.

Who is the supplier of money?

The government and the banking system of a country are suppliers of money or are the producers of money. Hence, money held by them is not a part of the stock of money held by the people.

Who are the suppliers of money in India Class 12?

These are the three main suppliers of money who regulate the supply of money in the economy:

  • Government.
  • Central Bank ( Reserve Bank of India)
  • Other commercial banks.

Who are the two suppliers of money in India?


  • Government.
  • Central Bank ( Reserve Bank of India).
  • Other commercial banks.

What is the money multiplier formula?

Money Multiplier = 1 / Reserve Ratio

The more the amount of money the bank has to hold them in reserve, the less they would be able to lend the loans. Thus, the multiplier holds an inverse relationship with the reserve ratio.

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What is the formula for money supply?

Finally, to calculate the maximum change in the money supply, use the formula Change in Money Supply = Change in Reserves * Money Multiplier. A decrease in the reserve ratio leads to an increase in the money supply, which puts downward pressure on interest rates and ultimately leads to an increase in nominal GDP.

What is 12th money?

Money: Money is something which is generally acceptable as a medium of exchange and can be converted into other assets without loosing its time and value.

What does Fiat stand for money?

Fiat money is government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it.

What are the types of money class 12?

Key Takeaways

  • Money comes in three forms: commodity money, fiat money, and fiduciary money. …
  • Commodity money derives its value from the commodity of which it is made, while fiat money has value only by the order of the government.
  • Money functions as a medium of exchange, a unit of account, and a store of value.

What is types of money?

That means that anything can technically be considered money, but the most accepted kind today comes in the form of paper, coins (metallic money), and credits (backed by banks). … There are 5 different types of money: Fiat, commodity, representative, fiduciary, and commercial bank money.

Is bank a money?

In contrast to the earliest forms of money, which were commodity moneys based on items such as seashells, tobacco, and precious-metal coin, practically all contemporary money takes the form of bank money, which consists of checks or drafts that function as commercial or central bank IOUs.

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