The discount rate is the interest rate that:

A) banks charge on large loans.
B) banks charge on loans to other banks.
C) the Fed charges on loans to branches of the U.S.government.
D) the Fed charges on loans to depository institutions.
E) the Fed charges on loans to the public.

Discount Rate

The rate at which financial institutions can borrow funds from the central bank, often used as a monetary policy tool.

Depository Institutions

Financial institutions that accept deposits from individuals and provide loans.

Fed Charges

Fees or interest rates set by the Federal Reserve, often in the context of lending to financial institutions.