Answer:
The correct answer is A. The interest rate that the Fed charges banks that borrow money from it is called the discount rate.
Explanation:
The discount rate is the interest rate at which a bank can sell (rediscount) bills of exchange to the central bank. This enables it to obtain liquidity in the short term. It pays the discount rate as a price (as a discount from the nominal value).
The Federal Reserve uses two discount rates for very short-term loans it gives to financial institutions during the "discount window": the "primary rate" and the "secondary rate”.
