Central Bank and Its Functions
Economics ⇒ Money and Banking
Central Bank and Its Functions starts at 11 and continues till grade 12.
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Describe the 'lender of last resort' function of the central bank.
Explain the difference between a central bank and a commercial bank.
Explain the difference between quantitative and qualitative methods of credit control.
Explain the importance of central bank independence.
Explain the role of the central bank in controlling inflation.
Explain the term 'bank rate'.
Explain the term 'Cash Reserve Ratio' (CRR).
Explain the term 'Moral Suasion' as used by the central bank.
What is the primary function of a central bank? (1) Issuing currency, (2) Accepting deposits from the public, (3) Providing loans to individuals, (4) Selling goods and services
Which of the following is a function of the central bank? (1) Accepting recurring deposits, (2) Acting as a clearing house, (3) Providing insurance, (4) Selling consumer goods
Which of the following is a qualitative method of credit control? (1) Open Market Operations, (2) Bank Rate Policy, (3) Moral Suasion, (4) Cash Reserve Ratio
Which of the following is a quantitative method of credit control used by the central bank? (1) Moral suasion, (2) Bank rate policy, (3) Direct action, (4) Margin requirements
Fill in the blank: The _______ is responsible for maintaining monetary stability in the country.
Fill in the blank: The central bank acts as a _______ to commercial banks.
Fill in the blank: The central bank acts as a _______ to the government.
Fill in the blank: The central bank is also known as the _______ of last resort.
Open Market Operations refer to the buying and selling of government securities by the central bank. True or False?
The central bank acts as a custodian of foreign exchange reserves. Yes or No?
The central bank can influence the money supply by changing the CRR. True or False?
The central bank is responsible for the regulation and supervision of the financial system. True or False?
