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Question : The interest rate at which a nation's central bank lends money to domestic banks often in the form of very short-term loans - is referred to as:

Option 1: Bank rate

Option 2: Repo rate

Option 3: Reverse repo rate

Option 4: Cash rate


Team Careers360 14th Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: Bank rate


Solution : The correct answer is the Bank rate.

A bank rate is the interest rate at which a nation's central bank lends money to domestic banks, often in the form of very short-term loans. The Central Bank of India is the RBI, and the RBI lends money to domestic banks, and the domestic banks need to pay the interest rate.

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