Multiple choice

Bank rate is the rate at which RBI gives credit to _______.

  1. Agricultural Industries

  2. Industrialists

  3. Commercial Bank

  4. Public
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Bank rate is the rate at which the Reserve Bank of India lends money to commercial banks without any collateral. It's a monetary policy tool used by RBI to control money supply and inflation. When bank rate increases, borrowing becomes expensive for commercial banks, which then pass on the cost to customers. The other options incorrectly identify beneficiaries of RBI credit.

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