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Questions and Answers
What is the main role of a central bank?
What is the main role of a central bank?
- Providing loans to commercial banks
- Setting interest rates for individual borrowers
- Increasing the monetary base (correct)
- Regulating the stock market
What is a distinguishing characteristic of central banks in most developed nations?
What is a distinguishing characteristic of central banks in most developed nations?
- They have no governance rights over them
- They are under direct control of the government
- They are institutionally independent from political interference (correct)
- They do not exercise scrutiny over legislative bodies
In addition to managing the currency and monetary policy, what other powers do many central banks have?
In addition to managing the currency and monetary policy, what other powers do many central banks have?
- Ensuring the stability of commercial banks (correct)
- Enforcing policies on environmental protection
- Setting up investment funds
- Regulating international trade agreements
Why are issues like central bank independence and policies a focus of contention and criticism?
Why are issues like central bank independence and policies a focus of contention and criticism?
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When did the notion of central banks as a separate category from other banks fully coalesce?
When did the notion of central banks as a separate category from other banks fully coalesce?
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