Which of the Following Are Primary Functions of a Central

question 47

Multiple Choice

Which of the following are primary functions of a central bank?
I. act as a regulator of banks
II. issue government bonds
III. set monetary policy
IV. regulate dividend payments by corporations

• A) I, II, III, and IV
• B) I, II, and III
• C) I and III
• D) I and II

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Definitions:

Dividend Income

Income received from owning shares of a company in the form of dividends.

Required Return

The minimum annual percentage earned by an investment that will induce individuals or companies to put their money into a particular project or investment.

Small Stock Dividend

A dividend paid in the form of additional shares, typically representing less than a 25% increase in outstanding shares.

Capital In Excess

Funds received by a company from issuing shares that exceed the par value of the shares.