One of the techniques of monetary control used by the central bank of Nigeria is

Analyze the question: The question asks which option is a technique (tool) the Central Bank of Nigeria (CBN) uses to control the money supply and credit in the economy.

Explain the concept: Monetary policy is the CBN's regulation of money supply, credit, and interest rates. Its main instruments are:

• Quantitative tools: open market operations (OMO), the discount/minimum rediscount rate (now the Monetary Policy Rate), cash reserve ratio, and liquidity ratio.
• Qualitative tools: selective credit control, moral suasion, directives and special deposits.

Fiscal policy, by contrast, is run by the government (the Ministry of Finance and the National Assembly) through taxation, government spending and borrowing.

Evaluate each option:

• A. Selective credit control: Correct. The CBN directs credit to preferred sectors (e.g. agriculture) or restricts it for others (e.g. consumer imports). It is a recognised qualitative monetary tool.
• B. Budget deficit: This is a fiscal policy matter. It happens when government spending exceeds revenue, and it is not a CBN monetary control technique.
• C. Foreign exchange control: This is a trade and exchange rate policy measure. It is sometimes associated with the CBN, but it is not classically listed as a monetary control technique in the syllabus.
• D. Monitoring the general price level: This is an objective or outcome the CBN tracks (price stability), not a technique for controlling money.

Exam tip: Remember the monetary tools as "OMO, MPR, CRR, LR, Selective credit, Moral suasion." If an option mentions budgets, taxes or government spending, it belongs to fiscal policy, so eliminate it when the question asks about the central bank.