Economics · Monetary Policy
The Term 'Repo Rate' refers to the interest rate at which:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The central bank borrows money from the union government
- 2The central bank lends money to commercial banks against government securities✓
- 3The central bank withdraws liquidity permanently from open circulation
- 4Commercial banks purchase foreign exchange reserves from the market
Correct answer
The central bank lends money to commercial banks against government securities
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