Money multiplier =Reserve Ratio1=0.101=10.
Total money creation =Initial Deposit×Multiplier=450×10=4500 crore.
If the reserve ratio is 10% and the initial deposit with the commercial banks are Rs. 450 cr, the total money creation by the banking system will be :
Verified 13 Jul 2026.
Rs. 4,000 Cr
Rs. 5,000 Cr
Rs. 3,500 Cr
Rs. 4,500 Cr
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