Question

A bank which functions in accordance with the economic interest of the whole country, which control credit and money is called

• A. Commercial Bank
• B. Investment Bank
• C. Central Bank
• D. Credit Union

Answer 1

Answer:

C. Central Bank

Definition of Central Bank:

• The Central Bank is the top most banking institution with control over the entire currency and banking system of a country.
• It acts as leader of money market in the country.
• Till the beginning of 20th century, Central Banks were known as 'Banks of Issue'.
• "A central bank is a bank which functions in accordance with the economic interest of the whole country, which control credit and money"
• According to BIS (Bank of International Settlement), "A central bank is the bank in any country to which has been entrusted the duty of regulating the volume of currency and credit in that country."