Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Discount Rate (Bank Rate)
This is the rate on central bank advances and is also called official discount rate or "minimum lending rate". When commercial banks find themselves short of cash they may, instead of contracting bank deposits, go to the central bank, which can make additional cash available in its capacity as "lender of last resort", to help the banks out of their difficulties. The Central Bank can make cash available on a short-term basis in either of two ways; by lending cash directly, charging a rate of interest which is referred to as the official "discount rate", or by buying approved short-term securities from the commercial banks. The central bank exercises regulatory powers as a lender of last resort by making this help both more expensive to get and more difficult to get. It can do the former by charging a very high "penal" rate of interest, well above other short-term rates ruling in the money market. Similarly, when it makes cash available by buying approved short-term securities, it can charge a high effective rate of interest by buying them at low prices. The effective rate of interest charged when central bank buys securities (supplying cash) is in fact a re-discount rate, since the bank is buying securities which are already on the market but at a discount.
The significance of this rate of interest charged by the central bank in one way or the other to commercial banks, as a lender of last resort, is that if this rate goes up the commercial banks, who find that their costs of borrowing have increased, are likely to raise the rates of interest on their lending to businessman and other borrowers. Other interest rates such as those charged by building societies on house mortgages, are then also likely to be pulled up.
isoquant and its properties
What are the important external forces Management has to identify all significant factors which influence a firm. These factors can largely be divided into two categories. Mana
Assignment about law of variable proportion
State about Production theory Production theory assists in determining the size of firm and level of production. It clarifies the relationship between marginal and average cost
Calculate point elasticity of demand for demand function Q=10-2p for decrease in price from Rs 3 to Rs 2.
how sample size technique is helpful in demand forecasting of a particular product?
how equilibrium output can be find in williamson model
Advantages of a Free Market System Incentive: People are encouraged to work hard because opportunities exist for individuals to accumulate high levels of wealth. Choice
What is the demand function It should be noted that by demand function, economists mean entire functional relationship which is the whole range of price-quantity relationship a
The Basis of Wage Claims The union's demand for higher wages is normally based on one or more of the following four arguments: 1. The cost of living argument This is
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd