What is High Powered Money Class 12

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Confused about what is High Powered Money in economics class 12. I will discuss high powered money concept, its meaning definition, and examples in detail.

This topic is concerned with the Money and Banking chapter of Macroeconomic class 12.

Let’s discuss it.

What do you mean by High Powered Money in Economics class 12

See, if we talk about India.

In India, the Reserve Bank of India has the sole right to publish and issue paper notes.

While the central government mint (publish) the coins currency and issue it through RBI in the economy.

So the whole stock of currency produced and issue in a country in the form of paper and notes and metal coins is the High Powered Money.

High Powered Money is also called the monetary base of a country.

Definition of High Powered Money

High Powered Money refers to the currency that includes coins and currency (paper) notes issued by the central bank in a country.

S.K Aggarwal

High Powered money is money produced by the RBI and the government.

Sandeep Garg

High Powered Money refers to the monetary base of base money in the country. It includes, i) currency held by the people, ii) cash reserves of the commercial banks with the RBI, and iii) vault cash of the commercial banks.

T.R Jain

Components of High Powered Money

High Powered Money = The total currency circulating in the public + Plus the currency that is physically held in the vaults of commercial banks + Plus the commercial banks’ reserves, held in the central bank.

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Anurag Pathak
Anurag Pathak is an academic teacher. He has been teaching Accountancy and Economics for CBSE students for the last 18 years. In his guidance, thousands of students have secured good marks in their board exams and legacy is still going on. You can subscribe his youtube channel and can download the Android & ios app for free lectures.
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