The correct answer is Option 2: 1-B, 2-D, 3-A, 4-C
| 1. |
Currency authority |
B.Bank of Issue |
| 2. |
Banker to the government |
D.Managing public debt |
| 3. |
Banker's bank |
A.Lender's last resort |
| 4. |
Supervisor |
C.Periodic inspection |
The central bank performs the following functions:
- Currency authority: The central bank has the right to issue the currency, also known as the bank of issue.
- Banker to the government: It performs all the functions of the government including granting land, managing public debt, advising the government, and agent to the government.
- Banker's bank: It acts as custodian of cash reserve, provides centralized clearing, and is the lender of last resort.
- Supervisor: It also carries periodic inspection of banks.
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