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What are three core functions of a central bank?

A
  • Implements monetary policy to meet the inflation target.
  • Acts as banker to the government and commercial banks.
  • Acts as lender of last resort during crises.
B
  • Controls fiscal policy to meet the inflation target.
  • Acts as banker to households and foreign governments.
  • Acts as insurer of last resort during crises.
C
  • Sets income tax rates to meet the inflation target.
  • Acts as lender to private firms and households.
  • Acts as market maker of last resort during crises.
D
  • Manages government spending to meet the inflation target.
  • Acts as banker to households and retailers.
  • Acts as guarantor of last resort during crises.

Card 1 of 22

2.4.3 Central banks and monetary policy Flashcards

  1. A Level
  2. /Economics
  3. /2.4.3 Central banks and monetary policy

22 flashcards on AQA A Level Economics 2.4.3 Central banks and monetary policy: the key terms, economic models and case studies you need to recall for Paper 1, Paper 2 and Paper 3.

Flashcards