Question

Unable to borrow from other banks, University Bank is forced to turn to the Federal Reserve for needed funds. What is the interest rate the Federal Reserve will charge University Bank called? A. open market operations required B. reserve ration C. federal funds rate D. discount rate E. simple money multiplier

Answer 1

Answer:

D. Discount rate

Explanation:

Change the interest rate to the quality of the banks can request from the Federal Reserve System. Member banks can request short-term loans from the EDF. The interest charged by the EDF to banks for loans is called the discount rate, which is higher than the interest rate of commercial banks. This has an effect on the amount of money that banks overdraw.