Answer to Question #129040 in Macroeconomics for Pradeep Kushwah

Question

What is meant by central bank? Why is it known as apex body?

Answer 1

A Central Bank is a monetary institution, which fully controls the production, circulation, and the supply of money in the market, seeking to regulate the member banks and stabilize a nation's economy and national currency.

It is known as the apex body because it serves the following functions;Monetary Authority,Issuer of Currency,Banker to other Banks, Regulator of the Banking System,Manager of Foreign exchange and Maintaining Financial Stability.