Bank rate means -

A Interest rate at which Bangladesh Bank lend money to other Banks
B Interest rate at which Banks gets money from other Banks
C Rate of interest that Banks on their credit
D Interest rate that is offered by banks to collect deposits

Correct Answer: Interest rate at which Bangladesh Bank lend money to other Banks

Bank rate is the rate charged by the central bank for lending funds to commercial banks. Higher bank rate will translate to higher lending rates by the banks. In order to curb liquidity, the central bank can resort to raising the bank rate and vice versa.
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