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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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