Question : The rate at which RBI gives short-term loans to commercial banks is called:
Option 1: repo rate
Option 2: reverse repo rate
Option 3: bank rate
Option 4: cash reserve rate
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Correct Answer: repo rate
Solution : The correct option is the repo rate.
The repo rate is the interest rate at which the Reserve Bank of India (RBI) offers short-term loans to commercial banks. The phrase repo means a repurchase agreement. It is a tool for monetary policy that central banks employ to manage liquidity and regulate interest rates in the market.
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Question : The interest rate at which the Reserve Bank of India provides overnight liquidity to banks is called ________.
Option 1: Reverse repo rate
Option 2: Marginal standing facility rate
Option 3: Repo rate
Option 4: Leverage rate
Question : What is the bank rate?
Option 1: The rate at which the Central bank of a country advances loans to other banks in the country.
Option 2: The rate at which banks advance loans to customers.
Option 3: The rate at which banks lend among themselves.
Option 4: The rate at which banks lend to money lenders.
Question : The ________ and _______ determine the corridor for the daily movement in the weighted average call money rate.
Option 1: Reverse repo rate, discount rate
Option 2: Marginal Standing Facility, reverse repo rate
Option 3: Liquidity adjustment facility, repo rate
Option 4: Bank rate, repo rate
Question : The reserve held by Commercial Banks over and above the statutory minimum with the RBI are called:
Option 1: Cash reserve
Option 2: Deposits reserves
Option 3: excess reserves
Option 4: momentary reserves
Question : Which of the following sponsors Regional Rural Banks (RRBs)?
Option 1: RBI
Option 2: Foreign banks
Option 3: National commercial banks
Option 4: Co-operative banks
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