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WAEC Economics 2000 Question 40

Question 40

Financial Institutions

Commercial banks settle their inter-bank indebtedness through

  1. A.merchant banks
  2. B.central bank
  3. C.development bank
  4. D.stock exchange.
Show the answer and explanation

Answer: B (central bank)

Explanation

The central bank is the bankers' bank and runs the clearing house where banks settle debts with one another.