Money in Real Life · 45 sec
Central bank
A practical idea for making clearer everyday money decisions.
The useful idea
- The useful idea
A central bank, reserve bank, national bank, state bank, or monetary authority is a financial institution that manages the monetary policy of a country or monetary union.
- How it works
In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base.
- Why it matters
Many central banks also have supervisory or regulatory powers to ensure the stability of commercial banks in their jurisdiction, to prevent bank runs, and, in some cases, to enforce policies on financial
Why this matters
Use Central bank to compare the trade-offs before committing money.
Try this
Use Central bank to compare the trade-offs before committing money.
Test your recall
Which idea belongs to the explanation of Central bank?
- Why it matters
- How it works
- The useful idea — correct
A central bank, reserve bank, national bank, state bank, or monetary authority is a financial institution that manages the monetary policy of a country or monetary union.
General education only — not personal financial advice.