a) Could a central bank become insolvent? Discuss. b) Suppose the Central Bank of Eswatini (CBE) would like to influence the interbank market rate ( ) (in percentage form), which is characterised by the following inverse demand function for reserves (in Billion Emalangeni, E): = 10 2 Given the E2.5 Billion of non-borrowed reserves and the 6.75% policy rate, determine the minimum amount of liquidity absorption that CBE would have to make for its policy rate to become effective. i. Would it be worthwhile for CBE to pursue such liquidity absorption policy? Discuss. ii. Given the conditions in a), what would be the prevailing interbank market rate and the amount of borrowed reserves from CBE if an increase in required reserves ratio made the demand for reserves to increase by half? c) Would it be worthwhile for CBE to pursue such liquidity absorption policy? Discuss.