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PLS HELP , ECONOMICS !! Compare and contrast the federal funds rate, the discount rate, and the prime rate

Respuesta :

The federal rate is defined as interest rate at which institutions lend reserved balances to other institutions overnight.

What is the difference between the federal funds rate, the discount rate, and the prime rate?

The discount rate is not an index, so for loans that they make to each other banks use the federal funds rate, without adding a margin.

The prime rate is a short-term rate; but not as short as the discount rate, which is typically an overnight lending rate.

Moreover, the discount rate is not publicized in a general publication.

Learn more about federal funds rate, refer to the link:

https://brainly.com/question/23451041

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