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WAEC Economics 2010 Question 37

Question 37

Financial Institutions

The Central Bank controls money supply through all the following except

  1. A.lending to the public.
  2. B.bank rate.
  3. C.legal reserve requirements.
  4. D.open market operation.
Show the answer and explanation

Answer: A (lending to the public.)

Explanation

The central bank does not lend to the general public; it uses bank rate, reserve requirements and open market operations.