Question

The bank rate means :
(a) Rate of interest charged by commercial banks
from borrowers
(b) Rate of interest at which commercial banks
discounted bills of their borrowers
(c) Rate of interest allowed by commercial banks on
their deposits
(d) Rate at which RBI purchases or rediscounts bills of
exchange of commercial banks

Answer 1

A bank rate is the interest rate at which a nation's central bank lends money to domestic banks, which in turn impacts economic activity .


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