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    Question

    If a scheduled commercial bank in India has net demand

    and time liabilities (NDTL) of ₹10,000 crore, how much must it maintain as Cash Reserve Ratio (CRR) with the RBI?
    A ₹300 crore Correct Answer Incorrect Answer
    B ₹400 crore Correct Answer Incorrect Answer
    C ₹425 crore Correct Answer Incorrect Answer
    D ₹450 crore Correct Answer Incorrect Answer
    E ₹500 crore Correct Answer Incorrect Answer

    Solution

    The current Cash Reserve Ratio (CRR) set by the RBI is 4%. Therefore, a bank with NDTL of ₹10,000 crore must maintain ₹400 crore (4% of ₹10,000 crore) as CRR with the RBI. This amount is kept in a non-interest bearing account, serving as a monetary policy tool and liquidity management mechanism.

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