Question : The minimum rate below which banks are not allowed to lead money except in cases specified by the Reserve Bank of India is called ______.
Option 1: repo rate
Option 2: reverse repo rate
Option 3: cash rate
Option 4: base rate
Correct Answer: base rate
Solution : The correct answer is the base rate .
The base rate is the lowest interest rate that a bank can offer loans at, except in certain circumstances where the RBI permits it. It is the lowest interest rate at which a bank can make a loan without making a profit.
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