Question

Which of the following is a feature of a central bank?

• A. is a bank located in the centre of the capital city.
• B. is responsible for the conduct of overall economic policy.
• C. is responsible for the conduct of a country's monetary policy.
• D. is a nation's single most important deposit accepting institution.

Answer 1

The correct option is C is responsible for the conduct of a country's monetary policy.

A central bank, or monetary authority, is a monopolized and often nationalized institution given privileged control over the production and distribution of money and credit. In modern economies, the central bank is responsible for the formulation of monetary policy and the regulation of member banks.