To increase the supply of money in a country, the central bank has to?

Assessment: JAMB UTME - Commerce - 2005 Subject: Commerce

Question 1 Report

To increase the supply of money in a country, the central bank has to?
Answer Details
To increase the supply of money in a country, the central bank has to **reduce cash ratio**. Cash ratio refers to the percentage of the total deposits held by a bank that it is required to keep as reserves. When the central bank reduces the cash ratio, it frees up more money for the banks to lend out to businesses and individuals, thereby increasing the supply of money in the economy.
Read lesson note on Money (JAMB)
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