The Percentage deposits which is commercial bank  must keep as cash reserves as decided by the Central bank is called ______________.

Cash Reserve Ratio

The correct answer is option (2) : Cash Reserve Ratio

Cash Reserve Ratio (CRR) = Percentage of deposits which a bank must keep as cash reserves with the bank.

Apart from the CRR, banks are also required to keep some reserves in liquid form in the short term. This ratio is called Statutory Liquidity Ratio or SLR.