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Question : The monetary policy instrument called "bank rate" is aligned to ______________.

Option 1: liquidity adjustment facility

Option 2: cash reserve ratio

Option 3: discount rate

Option 4: the marginal standing facility rate


Team Careers360 1st Jan, 2024
Answer (1)
Team Careers360 15th Jan, 2024

Correct Answer: the marginal standing facility rate


Solution : The correct answer is the marginal standing facility rate .

The marginal standing facility rate is the rate at which banks borrow funds overnight from the Reserve Bank of India against the approved government securities. It is used by the banks to borrow from the RBI in any emergency. The current marginal standing facility rate is 6.75% (Oct. 2023).

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