WAEC Economics 2020 Objective — Question 38
Question 38 of 50 from the West African Examinations Council (WAEC) Economics 2020 Objective paper, with the correct answer and a full explanation.
Advertisement
The central bank can reduce the ability of commercial banks to give out loans by
- A. raising the bank rateCorrect
- B. reducing special deposit
- C. reducing the liquidity ratio
- D. issuing more currency
Explanation
Raising the bank rate makes it more expensive/less attractive for commercial banks to borrow and lend, reducing their capacity/willingness to give out loans.
Advertisement
Sign up free to unlock
- Score tracking
- Practice history
- Saved questions
- Progress dashboard
- Personalized sessions
- Weak-topic breakdown
…and/or go further with premium services and No Ads.