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Functions of the Central Bank

Commercial ba...

Question

Commercial banks act as the lender of last resort in the economy.

A

True

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B

False

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Q. Give reasons or explain.

1. Clearing house system economises the use of cash.
2. Central Bank acts as a lender of the last resort.
3. The CRR affects the lending capacity of the banks.
4. As a banker to the government, the Central Bank transfers government funds.
5. A Central Bank may take 'Direct Action' against the defaulting commercial banks.

Q. Give reason or explain:
Central Bank acts as a lender of the last resort.

Q. How does a central bank act as the lender of the last resort?

Q. Give Reasons or Explain the following:
Central Bank acts as a lender of last resort.

Q. A central bank is a lender of last resort.

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