How do commercial banks primarily create money in an economy?

Question

General Studies · Banking and Finance

How do commercial banks primarily create money in an economy?

Verified Solution4 OptionsUpdated: October 2026👁️1 View

Share:

Correct answer

By lending a part of their deposits to borrowers

Download Single Question PDF

Save this question and verified answer as a clean study sheet with live clickable link.

👥

Share with Friends & Study Groups

Challenge your peer aspirants on WhatsApp or Telegram to solve this question!

Online Test Series

Preparing for General Studies?

Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.

Start Free Mock Test →

Chapter Practice

Want more practice questions on Banking and Finance?

Solve complete topic-wise tests with detailed solutions on GkGet.

Practice Banking and Finance MCQs →

Recommended practice questions in General Studies · Banking and Finance

Browse More General Studies →

1

Which of the following events is considered a major turning point that fueled Indian nationalism during British rule due to its brutal nature and widespread condemnation?

Solve Question→

2

Which of the following events is considered the first major peasant uprising against the British in India?

Solve Question→

3

Answer 1

By borrowing funds from the Reserve Bank of India

Answer 2

By issuing ATM and credit cards

Answer 3

By lending a part of their deposits to borrowers

Answer 4

By printing new currency notes

How do commercial banks primarily create money in an economy?

Download Single Question PDF

Share with Friends & Study Groups

Preparing for General Studies?

Practice by Subject

Practice by Exam

Topic-Wise Solved Questions

How do commercial banks primarily create money in an economy?

Download Single Question PDF

Share with Friends & Study Groups

Preparing for General Studies?

Related Practice Questions

Practice by Subject

Practice by Exam

Topic-Wise Solved Questions