With reference to Cash Reserve Ratio (CRR), consider the following statements:
1. CRR is the percentage of deposits which a bank must keep with itself in the form of any liquid asset.
2. Higher the CRR requirement, lower will be the credit creation in the economy.
Which of the statements given above is/are correct?
1
1 only
2
2 only
3
Both 1 and 2
4
Neither 1 nor 2