Thought experiment: If all banks were merged into a single monopoly bank, total deposits would… Assume no change in money supply or public preferences. Choose the correct option.
General Knowledge
Indian Economy
Difficulty: Medium
Choose an option
-
ARemain essentially unchanged
-
BAutomatically double
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CFall to half
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DVanish due to lack of competition
Answer
Correct Answer: Remain essentially unchanged
Explanation
Concept
- Aggregate deposits depend on money supply, reserve ratios, and public behavior, not on the number of banks per se.
Final AnswerRemain essentially unchanged