CUET CUET Economics 2024 - During festive season, the currency deposit ratio | PYQs + Solutions

CUET Economics 2024

Economics

Income & Employment

Easy

During festive season, the currency deposit ratio

decreases

increases

has no impact on it

first decreases then increases

Correct Option: 2

During the Festive Season:

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People withdraw more cash from banks → Currency with public ⬆️

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People deposit less in banks → Bank deposits ⬇️

Currency Deposit Ratio (CDR) =

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Currency with public ⬆️ / Bank deposits ⬇️

So when:

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- Numerator (currency) ⬆️

\newline

- Denominator (deposits) ⬇️

The CDR ⬆️ (increases)