Question

Bank Rate is the rate at which central bank discounts the bills of commercial banks.

• A. True
• B. False

Answer 1

The correct option is A True

Bank rate is the rate charged on the loans offered by the Central bank to the commercial banks without any collateral. It is also considered as the rate at which the central bank discounts the bills of the commercial banks. Bank rate is a quantitative credit control measure under the monetary policy of the government as it controls the overall supply of the money in the economy.