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Which of the following rates is not decided by RBI?
  • a)
    Cash Reserve Ratio
  • b)
    Repo Rate
  • c)
    Reverse Repo Rate
  • d)
    Bank Rate
  • e)
    Prime Lending Rate
Correct answer is option 'E'. Can you explain this answer?
Most Upvoted Answer
Which of the following rates is not decided by RBI?a)Cash Reserve Rati...
Option (E) is correct. Prime lending rate is the interest rate used by a bank which is decided by the concerned bank. It is usually the interest rate at which banks lend to favoured customers - i.e., those with good credit. The prime interest rate, or prime lending rate, is largely determined by the federal funds rate, which is the overnight rate that banks use to lend to one another. The prime rate is also important for individual borrowers, as the prime rate directly affects the lending rates available for a mortgage, small business loan or personal loan.
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