The refinancing rate is the interest rate
A) at which commercial banks lend to and borrow from each other.
B) the European Central Bank pays on reserves.
C) the public pays when borrowing from banks.
D) the European Central Bank charges on loans to banks.
E) banks pay on the public's deposits.

Question

Quizplus · Accepted Answer

The refinancing rate is the interest rate at which commercial banks can take out loans from the European Central Bank. Therefore, the correct choice is D, as the refinancing rate is the interest rate the European Central Bank charges on loans to banks.

The Refinancing Rate Is the Interest Rate