Economics · Money and Banking
Which of the following statements correctly defines the 'Lender of Last Resort' function of the Reserve Bank of India (RBI)?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Primarily providing credit to agricultural primary cooperative societies
- 2Directly intervening to manage exchange rate volatility in foreign markets
- 3Automatically financing all budgetary deficits incurred by the central government
- 4Providing liquidity support to solvent commercial banks facing temporary liquidity distress✓
Correct answer
Providing liquidity support to solvent commercial banks facing temporary liquidity distress
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