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Business Studies

Call Money and T- Bill

The Bank rate...

Question

The Bank rate is charged by the Reserve Bank of India on its advances to __________.

A

commercial banks

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B

co-operatives

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C

individuals

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D

government

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Solution

The correct option is A commercial banks
Bank Rate is the rate at which the commercial banks avail loans from the Reserve Bank of India (RBI).
It is used as a quantitative tool to change the quantity of money supplied in the economy.

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