A sudden mass withdrawal by depositors creates a liquidity crisis for commercial banks. In such situations, RBI provides emergency funds to commercial banks in its role as the lender of last resort.
If all the depositors, one day come to withdraw all the cash, what would be role played by RBI?
CUET UG 2023 — Economics Macro
2023mcqeasy
If all the depositors, one day come to withdraw all the cash, what would be role played by RBI?
Official previous-year question
Verified 13 Jul 2026.
Options
- A
Maintaining Foreign Exchange Reserves
- B
Lender of last resort
- C
Maintaining cash reserves
- D
Currency issue
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