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6. An increase in cash reserve ratio will cause yield curve to (i)Shift downward (ii) Remain unchanged (iii) Become steeper (iv) Become flatter

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Question added by Vinod Jetley , Assistant General Manager , State Bank of India
Date Posted: 2015/01/23
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Vinod Jetley
by Vinod Jetley , Assistant General Manager , State Bank of India

(i)Shift downward

Mohammed Salim Allana
by Mohammed Salim Allana , Compliance and Assurance Manager , United Arab Bank

Agreed with all champs, the higher the cash reserve ratio (interest free funds) would lower the yield curve.

Elke Woofter
by Elke Woofter , Project Assistant , American Technical Associates

I am also going with answer (i) Shift down

Michael Pawa
by Michael Pawa , cashier , sharjah cooperative society

it will shift downward...

VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Answer option (i)  >>>>>>>>> Shift downward

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