Which institution performs the activity of credit creation?
Which institution (s) performs the activity of credit creation?
(a) Commercial banks
(b) Central Bank
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Anurag Pathak Changed status to publish December 28, 2023
Ans – (a)
Explanation:-
It is one of the most important activities of commercial banks. Through the process of money creation, commercial banks are able to create credit, which is in far excess of the initial or Primary Deposits.
Anurag Pathak Changed status to publish December 28, 2023
