In an economy, the currency held by the public, Net Demand Deposits with Commercial Banks and Net Time Deposits with Commercial Banks stand at ₹ 1,42,000 crore, ₹ 22,000 crore and ₹ 86,000 crore respectively. The value of Money Supply (M1) would be ₹ _______ crore.
In an economy, the currency held by the public, Net Demand Deposits with Commercial Banks and Net Time Deposits with Commercial Banks stand at ₹ 1,42,000 crore, ₹ 22,000 crore and ₹ 86,000 crore respectively. The value of Money Supply (M1) would be ₹ _______ crore.
Show Hint
- 2,50,000
- 86,000
- 1,64,000
- 1,42,000
The Correct Option is C
Solution and Explanation
Money Supply (M1) is the sum of currency held by the public, demand deposits with commercial banks, and other liquid assets in the economy.
Step 2: Calculation of Money Supply (M1).
M1 = Currency held by the public + Net Demand Deposits + Net Time Deposits
M1 = ₹ 1,42,000 crore + ₹ 22,000 crore + ₹ 86,000 crore = ₹ 1,64,000 crore.
Step 3: Conclusion.
Therefore, the value of Money Supply (M1) is ₹ 1,64,000 crore. Final Answer:} ₹ 1,64,000 crore.
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