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WAEC Commerce 2004 Question 31

Question 31

Banking

Which of the following central bank functions inspires confidence in the banking system in case of emergency?

  1. A.issuing of currency
  2. B.lender of last resort
  3. C.banker's bank
  4. D.banker to the government
Show the answer and explanation

Answer: B (lender of last resort)

Explanation

As lender of last resort the central bank rescues banks in a crisis.