The interest rate that banks charge on loans to their best customers is called the:

Question

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The prime rate is the interest rate that banks charge their most creditworthy customers, usually large corporations. It is often used as a benchmark for other types of loans, such as mortgages or personal loans. The Federal Funds rate is the interest rate that banks charge each other for overnight loans to meet reserve requirements, and it is set by the Federal Reserve. The discount rate is the interest rate that the Federal Reserve charges banks for loans from the Federal Reserve discount window. The mortgage interest rate is the interest rate that a lender charges a borrower for a mortgage loan. Therefore, the best choice is the prime rate, which specifically refers to the interest rate charged by banks to their best customers.

The Interest Rate That Banks Charge on Loans to Their