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Business Studies

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The rate of i...

Question

The rate of interest banks charge its main/major and prime customers is popularly called as___________.

A

Risk Premium

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B

Prime Lending Rate

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C

Repo Rate

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D

Reverse Repo Rate

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Solution

The correct option is C Prime Lending Rate
Prime lending rate is also known as prime rate. It refers to the rate of interest bank charge its main and prime customers. Prime customers are also known as favored customers, that means, customers with good credits.

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