Give any two reasons as to why a country needs a Central Bank.

1.	Give any two reasons as to why a country needs a Central Bank.
Answer» The main reasons for the need of central bank for country are- (i) Central bank can regulate the whole financial sector and exercise control over the monetary and credit policies of the nation. (ii) It plays an important role in stabilizing the economy of the country. (iii) Central banks also act as a “lender of last resort” to the banking sector during times of financial crisis.

Answer»

The main reasons for the need of central bank for country are-

(i) Central bank can regulate the whole financial sector and exercise control over the monetary and credit policies of the nation.

(ii) It plays an important role in stabilizing the economy of the country.

(iii) Central banks also act as a “lender of last resort” to the banking sector during times of financial crisis.

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