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MEASURES OF MONEY SUPPLY IN India

The Reserve Bank of India defines the monetary aggregates as:

  • Reserve Money (M0): Currency in circulation + Bankers' deposits with the RBI + 'Other' deposits with the RBI = Net RBI credit to the Government + RBI credit to the commercial sector + RBI's claims on banks + RBI's net foreign assets + Government's currency liabilities to the public - RBI's net non-monetary liabilities.
  • M1: Currency with the public + Deposit money of the public (Demand deposits with the banking system + 'Other' deposits with the RBI).
  • M2: M1 + Savings deposits with Post office savings banks.
  • M3: M1+ Time deposits with the banking system = Net bank credit to the Government + Bank credit to the commercial sector + Net foreign exchange assets of the banking sector + Government's currency liabilities to the public - Net non-monetary liabilities of the banking sector (Other than Time Deposits).
  • M4: M3 + All deposits with post office savings banks (excluding National Savings Certificates).
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Explain how different monetary policies affect the money supply in the economy?

"Explain how different monetary policies affect the money supply in the economy?"


Who governed the Money Supply?

Reserve bank of India


Why does the LM curve slope upwards?

In equilibrium: Money supply = Money demand.Summarizing it, we can explain the upward sloping LM curve as following:If income is high then thedemand for money will be high relative to the fixed supply. In order to equilibrate money demand and money supply, interest rates have to also be high to reduce money demand


What is Concept of money and measures of money supply?

Money simply exists as a bartering system. A monetary value is placed on a commodity or service and is obtained by paying the correct amount of money. The term "money supply" simply refers to the amount of money, or assets, available in any economic system.


Explain how different monetary policies affect the money supply and the economy?

Monetary policies, such as expansionary and contractionary measures, directly influence the money supply and overall economic activity. Expansionary policies, like lowering interest rates or purchasing government securities, increase the money supply, encouraging borrowing and spending to stimulate economic growth. Conversely, contractionary policies, such as raising interest rates or selling government securities, reduce the money supply, aiming to curb inflation by dampening borrowing and spending. These adjustments can significantly impact inflation rates, employment levels, and overall economic stability.

Related Questions

Money supply measures in India by rbi?

explain in detail rbi's measures of money supply


Do you have supply of money in India ppt?

there are four measure of money supply in india,


Explain how different monetary policies affect the money supply in the economy?

"Explain how different monetary policies affect the money supply in the economy?"


Who governed the Money Supply?

Reserve bank of India


What commission is governed money supply?

Reserve Bank of India


Provide two definitions of the Canadian money supply explain the difference in the two definitions you provide?

The 2 definitions of the Canadian money supply are M1 and M2.


Why does the LM curve slope upwards?

In equilibrium: Money supply = Money demand.Summarizing it, we can explain the upward sloping LM curve as following:If income is high then thedemand for money will be high relative to the fixed supply. In order to equilibrate money demand and money supply, interest rates have to also be high to reduce money demand


What is Concept of money and measures of money supply?

Money simply exists as a bartering system. A monetary value is placed on a commodity or service and is obtained by paying the correct amount of money. The term "money supply" simply refers to the amount of money, or assets, available in any economic system.


Importance of money supply?

The money supply is commonly defined to be a group of safe assets that households and businesses can use to make payments or to hold as short-term investments. For example, U.S. currency and balances held in checking accounts and savings accounts are included in many measures of the money supply.


Define money supply in India?

see your central banks website you might find sth there


Explain how different monetary policies affect the money supply and the economy?

Monetary policies, such as expansionary and contractionary measures, directly influence the money supply and overall economic activity. Expansionary policies, like lowering interest rates or purchasing government securities, increase the money supply, encouraging borrowing and spending to stimulate economic growth. Conversely, contractionary policies, such as raising interest rates or selling government securities, reduce the money supply, aiming to curb inflation by dampening borrowing and spending. These adjustments can significantly impact inflation rates, employment levels, and overall economic stability.


What has the author M Thomas Paul written?

M. Thomas Paul has written: 'A re-examination of the long run relationship between money supply and inflation in India' -- subject(s): Inflation (Finance), Money supply