Question

Identify the goals of the central bank when creating monetary policy. Check all that apply.

reducing employment
influencing the business cycle
reducing economic growth
encouraging economic growth
avoiding periods of time where little credit is available

Answer 1

The correct answer is B, D, E

B. Influencing the business.

D. Encouraging economic growth.

E. Avoiding periods of time where little credit available.

Avoiding periods of time where little credit is available. The main purpose of  a central bank is to regulate and supervise financial institution and banks.

They maintain healthy levels of employment and inflation, improvement monetary policy, monitor and issue currency.

They aid government in services of financial payment. Central bank is good in economic growth because it controls the liquidity in system of financial.

They controls the amount of money which a bank can lend.

They operate in open market which sells securities and buys from member of banks.