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Distinguish between the following: a) Cash Reserve Ratio and Liquidity Reserve Ratio b) Foreign direct investment and foreign portfolio investment



A) cash reserve ratio refers to percentage of a bank's total deposit which is necessary to kept with central bank and liquidity reserve ratio is that which every bank is required to maintain a fixed percentage of its assets in form of cash or liquid assets. B) direct investment refers to purchase of assets abroad with the power to control them while portfolio investment refers to purchase of assets abroad without any control
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