Asked by Chasity Martin on Apr 26, 2024
Verified
The discount rate is
A) the interest rate the Fed charges banks.
B) one divided by the difference between one and the reserve ratio.
C) the interest rate banks receive on reserve deposits with the Fed.
D) the interest rate that banks charge on overnight loans to other banks.
Discount Rate
The interest rate charged to commercial banks and other depository institutions on loans received from the central bank's discount window.
- Attain knowledge regarding the causes and impacts of the discount rate and the federal funds rate.
Verified Answer
TB
Turky BasahelApr 29, 2024
Final Answer :
A
Explanation :
The discount rate is the interest rate the Federal Reserve charges commercial banks for short-term loans.
Learning Objectives
- Attain knowledge regarding the causes and impacts of the discount rate and the federal funds rate.