The rate at which the Central Bank grants loans to commercial banks against government securities is called the Repo Rate. So, the correct answer is B. Repo Rate.

Here's a step-by-step explanation:

1. Central banks use various tools to implement monetary policy. One of these tools is the repo rate.

2. The repo rate is the rate at which the central bank of a country lends money to commercial banks in the event of any shortfall of funds.

3. Repo rate is used by monetary authorities to control inflation. When the repo rate increases, borrowing from the central bank becomes more expensive. If the repo rate is reduced, banks can borrow money from the central bank at a cheaper rate.

4. The term "repo" stands for "repurchase agreement". In a repo, the commercial bank sells government securities to the central bank and agrees to repurchase them at a future date at a predetermined price.

5. Therefore, the rate at which this repurchase happens, i.e., the rate at which the central bank lends to commercial banks, is called the repo rate.

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The rate at which the Central Bank grants loans to commercial banks against government securities is called the Repo Rate. So, the correct answer is B. Repo Rate.

Here's a step-by-step explanation:

1. Central banks use various tools to implement monetary policy. One of these tools is the repo rate.

2. The repo rate is the rate at which the central bank of a country lends money to commercial banks in the event of any shortfall of funds.

3. Repo rate is used by monetary authorities to control inflation. When the repo rate increases, borrowing from the central bank becomes more expensive. If the repo rate is reduced, banks can borrow money from the central bank at a cheaper rate.

4. The term "repo" stands for "repurchase agreement". In a repo, the commercial bank sells government securities to the central bank and agrees to repurchase them at a future date at a predetermined price.

5. Therefore, the rate at which this repurchase happens, i.e., the rate at which the central bank lends to commercial banks, is called the repo rate.

Knowee AI · Accepted Answer

The rate at which the Central Bank grants loans to commercial banks against government securities is called the Repo Rate. So, the correct answer is B. Repo Rate.

Here's a step-by-step explanation:

1. Central banks use various tools to implement monetary policy. One of these tools is the repo rate.

2. The repo rate is the rate at which the central bank of a country lends money to commercial banks in the event of any shortfall of funds.

3. Repo rate is used by monetary authorities to control inflation. When the repo rate increases, borrowing from the central bank becomes more expensive. If the repo rate is reduced, banks can borrow money from the central bank at a cheaper rate.

4. The term "repo" stands for "repurchase agreement". In a repo, the commercial bank sells government securities to the central bank and agrees to repurchase them at a future date at a predetermined price.

5. Therefore, the rate at which this repurchase happens, i.e., the rate at which the central bank lends to commercial banks, is called the repo rate.

14.Rate at which the Central Bank grants loans to commercial banks against government securities is called A. Reverse Repo Rate B. Repo Rate C. Bank Rate D. GDP at Market Price

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