Multiple choice

Which of the following is not a function of the Commercial Banks?

  1. Acting as a lender of last resort

  2. Lending to the private and public sectors

  3. The provision of a cheque system for setting debts

  4. The provision of safe deposit facilities
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A Correct answer
Explanation

The lender of last resort function is exclusively performed by Central Banks to maintain financial stability during crises. Commercial banks do not act as lenders of last resort; instead, they borrow from the Central Bank when facing liquidity shortages.

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