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Q:

The special importance of banks among financial institutions comes from:-

  • 1
    their large and heavy transactions
  • 2
    their positions as suppliers of money
  • 3
    their power to create money
  • 4
    their influence on the economy
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Answer : 3. "their power to create money"
Explanation :

Although banks do many things, their primary role is to take in funds—called deposits—from those with money, pool them, and lend them to those who need funds. Banks are intermediaries between depositors (who lend money to the bank) and borrowers (to whom the bank lends money).

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