The interest rate that a bank must pay to borrow from its regional federal reserve bank is called
A) the National Discount Rate.
B) the Prime Rate.
C) the Federal Discount Rate.
D) Fed Funds rate.

Question

Quizplus · Accepted Answer

The interest rate that a bank must pay to borrow from its regional federal reserve bank is called the Federal Discount Rate. The National Discount Rate and Prime Rate do not relate to borrowing from a regional federal reserve bank. The Fed Funds rate is the interest rate that banks charge each other for overnight loans, not the rate that a bank pays to borrow from its regional federal reserve bank.

The Interest Rate That a Bank Must Pay to Borrow