Answer to Question #77572 in Microeconomics for GOPE

Question

2. Discuss the difference between the assets and liabilities of central Bank

Answer 1

The most important asset of central bank is securities, which the Central Bank uses to directly control the supply of money in the country.
Central Bank Liabilities are currency (which is held by the public), The government’s bank account (where the government deposits its revenues), commercial bank accounts (where commercial banks keep their deposits with the Central Bank).


Answer: Central banks assets are securities and foreign exchange reserves. Liabilities are currency, government’s bank account etc.