Which of the following is the function of the Reserve Bank of India?
I. Issuing of currency
II. Lender of last resort
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. Both I and II.
The Reserve Bank of India (RBI) performs several critical functions, including:
I. Issuing of currency: The RBI has the sole authority to issue currency notes in India, except for one-rupee coins and notes.
II. Lender of last resort: The RBI offers financial support to banks encountering liquidity shortages.