The basic purpose of imposing legal reserve requirements on commercial bank is to?
ECONOMICS
JAMB 1990
The basic purpose of imposing legal reserve requirements on commercial bank is to?
- A. assure the profitability of commercial banks
- B. provide a device through which credit creation by banks can be controlled
- C. provide a proper ratio between earning and non-earning bank assets
- D. provide the Central Bank with working capital
Correct Answer: B. provide a device through which credit creation by banks can be controlled
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