Economics · Monetary Policy
Which of the following statements correctly describes the Reverse Repo Rate?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is the interest rate charged by commercial banks when lending money to prime customers.
- 2It is a situation where the value of money falls and prices rise over a period of time.
- 3It is the interest rate paid by the RBI when commercial banks park their excess funds with the central bank.✓
- 4It is the rate at which RBI lends money to commercial banks for short-term periods.
Correct answer
It is the interest rate paid by the RBI when commercial banks park their excess funds with the central bank.
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