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Question
Give two major functions of the central bank of our country.
Solution
The Reserve Bank of India’s key functions are:
- Monopoly of Note Issue.
- Banker, Agent, or Advisor to the Government.
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RELATED QUESTIONS
Explain the functions of the RBI with respect to the following:
- Custodian of foreign exchange reserves.
- Monopoly of note issue.
- Clearing house facility.
- Banker and fiscal agent to the government.
Assertion (A): Central bank as a banker to the government, works as a custodian of foreign exchange reserves.
Reason (R): The Central bank acts as a Clearing house for the transfer and settlement of mutual claims of commercial banks.
The RBI settles claims of other commercial banks by a process of book entries. It helps to stabilize the banking system in the economy. Which function of the Central bank is explained here.
The main advantage of giving the monopoly right of note issue to the central bank is that it ______.
______ is the main function of central bank.
Which of the following is not a function of a commercial bank?
The central bank acts as ______.
Give two reasons why the central banks enjoy monopoly of note issue.
Who normally keep their deposits in the Central Bank?
Name the institution that enjoys the monopoly of note issue in India.
