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प्रश्न
"The central bank is the lender of the last resort." Explain.
Central Bank is the “lender of the last resort”. Justify either for or against.
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उत्तर
- Commercial banks can seek financial support from other banks.
- However, other commercial banks may not be able to provide funds to the bank in need. In this situation, the central bank gives funds to a commercial bank through loans or securities purchases.
- It helps to prevent widespread financial panic by stepping in when no other lenders are available.
- Maintaining confidence in the financial sector benefits the economy as a whole.
संबंधित प्रश्न
Reserve Bank of India cannot accept deposits from public.
Distinguish between the following:
Current account & Recurring deposit account
State with Reasons whether the following statement TRUE or FALSE.
Current account is suitable for salaried people.
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Briefly explain about Correspondent Banks?
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Write a short note on Local Area Banks, Give two examples.
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What is meant by an overdraft facility given by a commercial bank?
Distinguish between saving account and current account.
Explain main functions of commercial bank.
Why was EXIM Bank set up in India?
Which type of bank mainly provides long-term credit for agriculture?
Which bank specifically supports India’s exports and imports through long-term finance?
Development banks like SIDBI and NABARD mainly focus on ______.
Which type of bank provides only basic banking services and is not allowed to give loans?
Small Finance Banks are mainly designed to serve ______.
