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Question
Which of the following is/are the function(s) of central bank?
Options
Banker's bank
Lender of the last resort
Receive deposits from the public and business firms
Provide short-term and medium-term loans to customers
Solution
Banker's bank and Lender of the last resort
Explanation:
The functions of a central bank include acting as the "banker's bank" and serving as the "lender of last resort." However, it does not typically receive deposits from the public or provide short-term and medium-term loans to individual customers; these functions are usually performed by commercial banks.
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In a 40 minute long speech Prime Minister Narendra Modi announced the demonetisation of existing notes of ₹ 500 and ₹ 1,000 during a televised address on Tuesday evening. - "What is demonetisation and why was it done?" |
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| Column A | Column B | ||
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| (2) | Fixed Exchange Rate | (b) | The foreign exchange rate is determined by the demand and supply. |
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| (4) | Managed Fixed Rate | (d) | The Central Bank controls the foreign rate regime |
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