Question

Feds System Tools and Monetary Policy Quick Check
1 of 51 of 5 Items
Question
What is the interest rate that banks charge each other for overnight and short-term lending?(1 point)
Responses

reserve requirements
reserve requirements

discount rate
discount rate

prime rate
prime rate

federal funds rate
federal funds rate
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Answer 1

The interest rate that banks charge each other for overnight and short-term lending is called the **federal funds rate**.