The discount rate is the interest rate on
A)loans of reserves between banks.
B)discount loans from the Federal Reserve.
C)discount bonds.
D)federal agency securities.

Question

Quizplus · Accepted Answer

The discount rate is the interest rate charged by the Federal Reserve on discount loans provided to member banks. These loans are typically short-term and serve as a source of liquidity for banks that need to meet reserve requirements or other obligations. Therefore, "discount loans from the Federal Reserve" is the correct choice.

The Discount Rate Is the Interest Rate on