the financial sector

Question 1

role of financial institutions

Answer 1

make credit available
share/pool risk
enable money to make a smooth transition across time and geography

Question 2

role of the central bank

Answer 2

implement ECB monetary policy
supervisory role over financial institutions
produce/distribute € notes/coins
act as a banker/agent to the government
consumer protection

Question 3

role of the european central bank

Answer 3

maintain price stability
formulate and implement EU monetary policy
financial stability and supervision
sole right to issue euro currency

Question 4

importance of regulation in the banking sector

Answer 4

to protect consumers, esp. depositors
to ensure proper lending policies
improve economic stability/confidence
less need for gov intervention