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How does the Central Bank use the Bank Rate Policy to influence the economy?
  • a)
    By lowering interest rates to boost spending
  • b)
    By issuing more currency notes
  • c)
    By accepting more public deposits
  • d)
    By raising the bank rate to increase borrowing costs
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
How does the Central Bank use the Bank Rate Policy to influence the ec...
The Central Bank raises the bank rate to increase borrowing costs, which reduces the flow of credit and can help control inflation, thereby stabilizing the economy.
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