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What is High Powered Money?
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High Powered Money is the money that the RBI and the government create, with the public holding the currency and banks holding the cash reserves. It is distinct from money in that money is made up of demand deposits, whereas cash reserves are used to create demand deposits.

So, to sum up, high powered money is

 H = C + R

Where,

H = High powered money

 C = Currency

 R = Cash Reserves of Commercial Banks
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