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    Question

    What is the term for the interest rate that a central

    bank charges on loans to commercial banks?
    A Repo Rate Correct Answer Incorrect Answer
    B Reverse Repo Rate Correct Answer Incorrect Answer
    C Bank Rate Correct Answer Incorrect Answer
    D Base Rate Correct Answer Incorrect Answer

    Solution

    The Bank Rate is the rate at which the central bank of a country lends money to commercial banks, often used as a tool to control liquidity and inflation. It is distinct from the repo rate, which is the rate at which banks borrow from the central bank by selling securities.

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