Credit multiplier differs from money multiplier mainly because credit multiplier assumes:

CA Foundation · Business Economics · RTP · May 2026
Credit multiplier differs from money multiplier mainly because credit multiplier assumes:
(A) A. No time deposits
(B) B. No excess reserves and no currency leakages
(C) C. Perfect capital mobility
(D) D. Fixed interest rates

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. No excess reserves and no currency leakages

Topics: Money Market

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