The rate of interest banks charge other banks for overnight loans of reserves is the

Question

Quizplus · Accepted Answer

The overnight interest rate is the correct term for the rate of interest banks charge each other for overnight loans of reserves. The discount rate is the rate at which banks can borrow reserves directly from the Federal Reserve, and the prime rate is the rate that banks charge their best customers. The real rate is the nominal interest rate adjusted for inflation, and the daily nominal rate is not a standard term used in finance.

The Rate of Interest Banks Charge Other Banks for Overnight