1
Q
what is a central bank?
A
major bank in a country responsible for monetary policy and maintaining financial stability
2
Q
what are the 4 main roles of the central bank?
A
- implementation of monetary policy
- banker to the government
- bank to banks- lender of last resort
- regulating the banking industry
3
Q
what is the lender of last resort function?
A
providing emergency loans to financial instututions- in times of crisis to prevent collapse
4
Q
how does the central bank act as a banker to the government?
A
- issuing and selling government bonds on behlaf of government to finance it’s budget and borrow money
- providing financial advice to government
