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WAEC Commerce 2020 Question 27

Question 27

Banking

The bank which acts as the lender of last resort is the

  1. A.Central Bank.
  2. B.Commercial Bank.
  3. C.Merchant Bank.
  4. D.Mortgage Bank.
Show the answer and explanation

Answer: A (Central Bank.)

Explanation

The central bank lends to commercial banks when they cannot get funds elsewhere: the lender of last resort.