Match each rate with who lends to whom.

Match each rate with who lends to whom. — CUET Economics practice

Question 21

MediumOriginal question

Match each rate with who lends to whom.

List I	List II
A. Repo rate	I. Banks to the RBI
B. Reverse repo rate	II. A bank to its customers
C. Bank rate	III. RBI to banks, short-term, against securities
D. Lending rate of a bank	IV. RBI to banks, for longer periods

A-III, B-I, C-IV, D-IICorrect answerYour answerA-III, B-IV, C-II, D-ICorrect answerYour answerA-II, B-III, C-IV, D-ICorrect answerYour answerA-IV, B-III, C-I, D-IICorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

The first three are policy rates set by the central bank; the last is set by each bank.

Concept: Who lends to whom
Typical timeTypical: 90 s
Your timeYours: —

The rule this testsRepo, reverse repo and bank rate

Practise this chapter →

Ten questions from The Central Bank & Monetary Policy, at your own pace.

Practise this chapter →

Ten questions from The Central Bank & Monetary Policy, at your own pace.

Question 21

Explanation