CIMA Fundamentals of Business Economics BA1 Question # 4 Topic 1 Discussion

CIMA Fundamentals of Business Economics BA1 Question # 4 Topic 1 Discussion

BA1 Exam Topic 1 Question 4 Discussion:
Question #: 4
Topic #: 1

Central banks inspect and sometimes set minimum limits on the reserves held by commercial banks. Which ONE of the following statements is NOT a reason that central banks seek to influence the reserves of commercial banks?


A.

To influence commercial banks' ability to create credit


B.

To avoid the commercial banks running out of liquidity


C.

To regulate the profits of commercial banks


D.

To prevent the collapse of the banking system


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