Practicing Success

Target Exam

CUET

Subject

Business Studies

Chapter

Financial Markets

Question:
It is a method by which banks borrow from each other to be able to maintain the cash reserve ratio. Which of the following is being referred to here?
Options:
Commercial bill
Commercial papers
Call money
Certificate of deposit
Correct Answer:
Call money
Explanation:
Call money is a method by which banks borrow from each other to be able to maintain the cash reserve ratio. The interest rate paid on call money loans is known as the call rate.