Question : Which money market instrument is highlighted in the given statement?
Statement: The changes in CRR affects the amount of funds available to be given as loans by commercial banks.
Option 1: Treasury bill
Option 2: Call money
Option 3: Certificate of deposits
Option 4: Commercial bill
Correct Answer: Call money
Solution : Call money or call loans means that loan document the payment for which can be made at a short note is either by the borrower or the lander. Under this the maturity period of the loan is between 1 and 15 days. On this very basis it can be seen, call loans are absolutely liquid. The changes in CRR affect the amount of funds available to be given as loans by commercial banks.
Hence, option B is correct.
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