The discount rate is the interest rate that a. banks charge one another for loans....

Question

Question

The discount rate is the interest rate that

a. banks charge one another for loans.

b. banks charge the Fed for loans.

c. the Fed charges banks for loans.

d. the Fed charges Congress for loans.

Answer 1

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Answer #1

Solution -

The correct answer will be option C i.e The fed charges banks for loan .

It is simply the interest rate charged to commercial banks and other financial institutions on loans they borrow from the regional federal banks .

Hence option C is the correct answer.

Option A and B is wrong as Banks don't charge the discount rate .

Option D is wrong as this interest rate is charged up on banks not Congress.

Answer 2

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