If a bank borrows from a Federal Reserve Bank,the interest rate is called
A)the prime rate.
B)the discount rate.
C)the Fed funds rate.
D)the reserve availability rate.

Question

Quizplus · Accepted Answer

When a bank borrows from a Federal Reserve Bank, the interest rate is called the discount rate. The prime rate is the interest rate that banks charge to their most creditworthy customers, the Fed funds rate is the interest rate at which banks lend and borrow reserves from each other, and the reserve availability rate is not a common term used in monetary policy.

If a Bank Borrows from a Federal Reserve Bank,the Interest